(Akash Girimath – FXStreet)
– Cardano price swept equal lows at $0.425 and is ready to trigger a reversal.
– Investors can expect ADA to break out of its consolidation and kick-start a 25% rally to $0.530.
– A daily candlestick close below the October 2 swing low at $0.415 will invalidate the bullish thesis.
Cardano price has weathered the recent market slump and held its own. In addition to its ongoing consolidation, ADA has swept below a crucial level to collect liquidity, which could kick-start a reversal soon.
Cardano price ready to make its move
Cardano price has been producing liquidity fractals since mid-June, which is essentially a sweep of the previously formed low followed by a quick run-up. So far, there have been eight liquidity runs, with the most recent one taking place on October 2. Equal lows formed at $0.425 were swept, collecting the sell-stop liquidity and punishing early bulls.
Interestingly, Cardano price has also recovered above the $0.425 level, indicating that the buyers are back. Going forward, investors need to wait for ADA to recover above the $0.435 hurdle, which will open the path to start a bull rally.
This development could see Cardano price retest the $0.472 resistance barrier first, clearing which will propel it to another significant blockade at $0.505. The goal of this run-up would be to rebalance ADA at $0.530.
On the other hand, if Cardano price fails to stay above $0.425, it will denote weakness. A daily candlestick close below the October 7 swing low at $0.415 will invalidate the bullish thesis for Cardano price by producing a lower low.
This development could see ADA crash 8% to revisit the weekly support level at $0.380.