Despite Downturn, Cardano (ADA) Price Action Enters Its Ninth Week of Sideways Trading and Is Likely to Continue

Cardano’s sideways price action has entered its ninth week and is likely to be continued, per market analysts. Assessing the token’s 7-day price trajectory

Crypto market analysis firm, Benzinga, has shared its observations on Cardano’s price action, noting that the token’s sideways price has continued for the ninth week.

Over the past seven days, the altcoin has traded in a narrow range, indicating low volatility or a lack of strong directional movement.

Looking ahead, traders can anticipate a potential price drop to the 0.382 fib (Fibonacci Retracement) level, which translates to 63 cents.

Fib levels are a key technical metric used to identify potential support and resistance levels of an asset or stock. These levels are based on the Fibonacci sequence, a series of numbers in which each number is the sum of the two preceding ones.

The fib levels are 0, 0.236, 0.382, 0.5 and 0.618. The 0 fib is the lowest price point in the move, while the 1 fib is the highest price point.

To calculate the fib levels, you can use the fib tool on a charting software. Simply select the two extreme points of the move you want to analyze, and then drag the fib tool to the price level you want to convert.

For example, if you want to calculate the fib levels for Bitcoin’s move from its 2022 lows to its 2023 highs, you would select the lowest price point of the move as the 0 fib level, and the highest price point of the move as the 1 fib level.

Once you have selected the two extreme points of the move, the fib levels will be automatically calculated and displayed on the chart.

The 0.382 fib level is often a key support or resistance level, and it is also the fib level that is used to determine the optimal entry point for an investment.

In the case of Cardano, the 0.382 fib level is at 63 cents. This level is also closely tied to the 200 SMA (simple moving average).

The SMA is another key technical indicator that is used to identify the average price of an asset over a specific period of time. The 200 SMA is typically used to identify long-term trends.

As seen in the chart above, the price is approaching the 200 SMA, which could provide support for the token.

However, traders need to be aware that the 0.382 fib level is a strong support level, and it is likely to slow down any further declines in the token’s price.

Another crucial aspect highlighted by the white circle is at 63c, which is also closely related to the 200 SMA (simple moving average).

This observation further confirms ADA’s expected drop to approximately $0.63, ultimately strengthening the bearish sentiment surrounding the token.

Despite the bearish outlook, market analysts believe that the current price levels present an attractive entry point for retail investors. In such a scenario, traders can capitalize on the price decline and continue accumulating the token, anticipating a future price increase.

Additionally, there is a belief that ADA is undervalued at these levels, further fueling optimism for a rebound in the token’s price.

Cardano’s Retail Investors Focus on Accumulation Amidst Downturn

After a significant downturn, a silver lining emerges with the 200 SMA, often recognized as a strong support line. The convergence of the price with this line is viewed by some traders as a bullish signal.

Meanwhile, founder Charles Hoskinson recently revealed that the blockchain platform is exploring the possibility of introducing Ripple’s stablecoin, RLUSD, to Cardano.

Currently, both leading blockchain firms are in discussion stages; if successful, it could herald mass adoption of stablecoins on the smart contract platform.