Cardano (ADA) Is Approaching a Potential Breakout Rally Amid Market Recovery and a Rising Number of Long Positions

As Bitcoin reclaims the $87000 mark, the altcoins are gradually regaining momentum. Cardano, in the past 24 hours, has surged by 1.79% to sustain its dominance above the $0.70 psychological mark.

Cardano price has shown strength as Bitcoin price stays above the $87,000 mark and altcoins continue to recover. In the past 24 hours, ADA has surged by 1.79% to sustain its price above the $0.70 psychological mark.

As of Monday morning, the ADA token is trading at a market price of $0.7239, marking its second consecutive bullish candle and aiming to surpass the 200-day EMA line. With a fresh bullish start to the week, will this recovery lead to an ADA price surge to the $1 psychological mark?

Cardano Analysis Teases Breakout Rally

On the daily chart, the ADA price trend shows a short-term rounding-bottom reversal from the $0.70 psychological level. This completes a morning-star pattern on Sunday with a 1.31% recovery.

The bullish recovery continues with an intraday price surge of 1.58%, creating its second consecutive bullish candle. However, the recovery run faces resistance from the 200-day EMA line.

The dynamic average line acts as a crucial short-term resistance, keeping bullish growth in check. Moreover, due to the prevailing downturn and short-term consolidation, the 20-day and 200-day EMA lines are on the verge of giving a bearish crossover.

However, as the broader market recovers, a bullish recovery in Cardano that surpasses the average line will likely reduce the chances of any bearish crossovers.

Currently, consolidation is keeping the Cardano price between $0.70 and the 61.80% Fibonacci level at $0.7351. Due to the short-term consolidation, the daily RSI is approaching the halfway level, reflecting neutrality in trend momentum.

Increased Long Positions Amid Market Recovery

The current Cardano price trend shows a double-edged scenario at play. However, the broader market recovery signals a potential boost for the Cardano futures market.

Open interest has surged to $785.91 million, while the funding rate of the long-to-short ratio has reached a neutral point at 1.0396. This marks a significant rise in the number of bullish positions over the past three days.

Currently, the funding rate is at -0.0029%, reflecting a slight weakness in bullish sentiment.

Will Cardano Price Hit $1?

According to the Fibonacci levels, a bullish breakout of the 61.80% level will likely result in a price surge to the 78.60% level. This crucial resistance is just below the $1 psychological mark at $0.9216.

On the flip side, the 50% level at $0.6272 remains a key support for Cardano. A closing below this level will likely test the long-standing support trendline near $0.5708.