Trade Recommendation: Cardano
We’ve been watching Cardano (ADA/BTC) for a few days now. The breach of weekly support of 0.00000969 drove the market to print a fresh 2018 low of 0.00000904 on November 25. At that point, Cardano looked weak and it appeared headed to the next weekly support of 0.00000730.
Fortunately for bulls, the market was in oversold territory in the daily chart as well as the 4-hour chart. Bulls exploited the opportunity and sparked a rally to as high as 0.00001012 on November 28. However, the market pulled back the next day and closed below 0.00000969 on November 30. The good news is that bulls have been fighting back since.
Technical analysis shows that ADA/BTC has once again recovered weekly support 0.00000969. The recovery puts the market back in the range between 0.00000969 and 0.00001375. More importantly, it now looks like the breach below the support is a bear trap. If that is the case, then the market will likely rally to the top end of the range.
In addition, we can see a large bullish divergence on the daily chart. More importantly, the recovery of 0.00000969 puts the market in the position to form a double bottom reversal pattern.
The strategy is to buy as close to 0.00000969 as possible. As long as bulls stay above this support, ADA/BTC has the momentum to climb to our target of 0.00001375.
Daily Chart of Cardano/Bitcoin on Binance
As of this writing, the Cardano/Bitcoin pair is trading at 0.00001005 on Binance.
Summary of Strategy
Buy: As close to 0.00000969 as possible.
Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.
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