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Cardano short-term Price Analysis: 19 August

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Ethereum, Synthetix, Maker price analysis: August 27
Source: Pixabay

It’s safe to say that yesterday’s wick down to $0.1277 will be the last one in a while for Cardano. Both on the higher time frame, as mentioned earlier, and the lower time frame, Cardano is bullish.

Still, in the 8th rank, ADA is currently trading at $0.1328 with the 24-hour price change showing a 5.50% decline. There is a potential for a good long position with a minimum surge of 20%.

Cardano 4-hour chart

Source: ADAUSD TradingView

Cardano has formed a continuation pattern which is a bullish pennant pattern with upsides ranging from 20% to 100%. The symmetrical triangle is the consolidation pattern that will provide momentum for buyers to push through. This can be thought of as an accumulation zone for further upside.

Hence, a long position with a 2.47 risk-to-reward ratio with entry at $0.1301 and stop-loss at $0.1195 [aka 8.20% of the capital]. The target can vary, the position can be closed at 0.1564 which also happens to be the 0.5-Fibonacci level; this will give a 20% upside. However, another target is 0.382-Fibonacci level, which is at $0.2625 or a 100% surge from the current price.

With proper leverage and risk understanding, this seems like the best trade for ADA in a while. Supporting this long position is the RSI indicator, which shows a clear bullish divergence between the price and the momentum indicator.

Cardano 1-day chart

Soure: ADAUSD TradingView

The one-day chart also shows a similar bullish bias for Cardano, which has been trending higher with higher lows and lower highs forming a proper consolidation pattern.

Even on the higher time frame, the RSI indicator showed a clear bullish divergence, in addition to the bullish pennant pattern. Hence, this long position seems like a no-brainer.

Additionally, the 50-DMA [yellow] has supported the last two dips, hence, the bounce from the daily moving average will be a strong one.

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Akash is a full-time cryptocurrency writer and an analyst at AMBCrypto. He is an engineering graduate with an avid interest in finance and economics. Attracted to the chaos of trading, Akash has invested in BTC, ETH and XRP for educational purposes.

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