Cardano short-term Price Analysis: 02 November

Disclaimer: The findings of the following article are the sole opinion of the writer and should not be taken as investment advice

Cardano noted a positive price week after its Goguen roadmap was announced on the 30th of October. While ADA’s valuation did rise for a few days after the aforementioned date, a few hours before press time, ADA registered a massive drop on the charts. Dropping below the support level at $0.098 at the time, ADA might face some corrections over the next few trading sessions.

Cardano 1-hour chart

Source: ADA/USD on Trading View

The 1-hour chart for Cardano pointed to the formation of an ascending broadening wedge. While the price movement within the pattern was an incline, it carried bearish consequences. Now, another key bearish signal was the closing of the press time candle below the 50-Exponential Moving Average. This was a strong indication of strong resistance above, a development that might suggest a period of correction for ADA.

While trading volume remained consistent on the chart, other market indicators were flipping the narrative.

Reasoning

Source: ADA/USD on TradingView

The attached indicator chart is clearly bearish in the short-term. The MACD line completed a strong bearish crossover with the Signal line. The Awesome Oscillator pointed to declining bullish momentum and finally, the Relative Strength Index or RSI remained under the grip of selling pressure.

At the moment, even though buyers might make a comeback, it is very likely that the selling pressure will drag down the price to the oversold position.

Price Targets/Important Range

Resistance: $0.098, $0.0965
Support: $0.094 $0.0916
Entry Position for Shorts: $0.00965
Take Profit Range: $0.094 for R/R of 1.67x and $0.0916  for R/R of 3.27x
Stop Loss: $0.098

Conclusion

Right now, a strong period of correction should ensue before another bullish rally takes precedence. While the support at $0.0916 should hold strong, higher selling pressure might lead to a re-test at $0.089.