Cardano price is holding firm against the US dollar as it exchanges hands at $0.374. ADA, the token that powers the Cardano ecosystem, is up 52% in 30 days and has managed to capture a 7% increase in value over the last 14 days.
Despite this bullish report, the launch of Djed, the first stablecoin on the Cardano blockchain, failed to generate positive price change. However, its impact may not be removed immediately and may eventually trigger a rally as investors slowly embrace DZ.
Cardano is a $12.9 billion crypto ecosystem, currently ranked eighth and commands over $400 billion in trading volume. Although the ADA price has remained relatively unchanged over the past 24 hours, its bullish outlook appears intact.
Therefore, the bulls only need to get above $0.40, where they are likely to unlock bullish potential and open the door to gains in the coming weeks, possibly months, and the first target for $3 by the end of 2023.
Why Cardano price is close to validating a long-term uptrend
Cardano price has been dealing with resistance at $0.40 for a few days, although it is teetering at $0.374 at the time of writing. The smart contract token has continued its uptrend for more than three weeks in January, with this week being the only one in the red.
ADA isn’t the only token whose price is up 7.4%, all of the top ten cryptocurrencies are in the red on Tuesday, with the exception of Dogecoin, which has gained in value.
Investors across the board are awaiting the outcome of the United States Federal Open Market Committee (FOMC) meeting that begins today. Market watchers expect an interest rate hike of 25 basis points compared to the previous 50 basis points. This change will reflect the overall sentiment that inflation in the greenback nation is falling.
The US Consumer Price Index (CPI) reported a drop in inflation to 6.5% in December from 7.1% posted in November — monitored on an annual basis. While this figure is not exactly positive for the global economy, it does show that things are starting to move in the right direction – a situation that is likely to result in modest rate hikes in the future.
A reduction in rate hikes is a positive sign for investors to direct more money into riskier assets like cryptocurrencies. Therefore, crypto assets like Cardano may experience a drop in liquidity ahead of the Fed’s decision on interest rates later Wednesday.
Evaluating the short-term profitability aspect of ADA pricing
The Moving Average Convergence Divergence (MACD) indicator gives a buy signal on a weekly time frame chart. This call for investors to buy ADA came into the picture after the MACD line flipped above the signal line from red to blue earlier in the year. The ongoing movement, closing at the average line at 0.00, cements a bullish grip on the Cardano price.
Traders should also be on the lookout for an incoming flip of the MACD into positive territory. Such a move would be highly bullish for the Cardano price as it would tap the freshly created momentum for gains that could see $1 in the medium-term and $3 in the long-term.
Similarly, Cardano price is trading above the first multi-month trading high, drawn on the daily time chart, as illustrated below. A break above this resistance line allowed the bulls to fully assume the reins, helping them keep the December low of $0.24 intact to $0.40.
Cardano price rally stopped prematurely when it failed to break and hold above the selling crowd at $0.4. ADA is trading at $0.374, preferably above $0.35, looking for a suitable support zone.
It is important for investors not to lose sight of the bigger picture as a spike above $1 is still on the cards in the coming weeks. Note the Money Flow Index (MFI) in the lower range of overbought territory. This position shows that despite a small pullback from $0.40, buyers have the upper hand.
If investors hold their positions and brave the mundane activities in the crypto market for the next few days, a breakout could follow by the end of the week, with the Cardano price likely to reach $0.50.
Traders should also look for two things: a clear break and hold above $0.40 and another above the upper falling trend line. If the 50-day exponential moving average (EMA) (in red) is above the 100-day EMA (in blue), the bullish grip on the ADA price will likely tighten over the next few days.
On the other side of the bar, a sell signal from the MACD on the daily time frame chart can help investors factor in an ongoing pullback. However, if the MACD line in blue continues to hold below the signal line in red, the decline could increase, forcing the Cardano price to find support at $0.30.
Cardano options to buy today
Investors looking to buy Cardano may want to consider other high-potential crypto projects alongside ADA, consolidating it.
Here are the top 15 cryptocurrencies for 2023, analyzed CryptoNews Industry Negotiation Team.
The list is updated weekly with new altcoins and ICO projects.
Disclaimer: The Industry Talk section contains insights from crypto industry players and is not part of the editorial content of Cryptonews.com.
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