ADA is changing hands at $1.15, just above the upper boundary of a descending parallel channel
The price of Cardano against the US dollar is up by 1.78% over the past 24 hours. The 5th ranked cryptocurrency has traded higher after a difficult few days that saw bears sink prices towards $1.00.
The technical picture suggests bulls could stage a fresh rally towards a key supply wall near $1.20. If buyers increase their orders above the$1.20 level, ADA could likely reach $1.35.
On the contrary, ADA/USD could become vulnerable to a bearish flip towards $1.00 if sellers strengthen below the 100 SMA.
Cardano price outlook
Cardano’s price saw a major decline over the past week, dropping to lows of $1.06 after hitting rejection near $1.35.
The cryptocurrency has bounced off the aforementioned lows and looks set to extend upward in a trajectory that currently faces strong resistance near $1.20.
As of writing, the ADA/USD pair has moved above the 0.236 Fib level of the swing from $1.34 to $1.06, which provided initial resistance at $1.13. This hurdle was near the upper boundary of a declining channel.
Bulls need to push higher above the channel’s limit to prevent a swift retreat into consolidation. Notably for bulls, a high is formed near $1.159. As such, Cardano’s price will likely see another leg up if it settles above the 100 SMA ($1.16) on the 4-hour chart. The area provides for a horizontal resistance line that has capped prices multiple times over the past week.
A clear break above the line will allow bulls to push towards $1.20, which is also marked by the 0.5 Fib level of the move from $1.34 to $1.06. Above this zone, the 0.618 Fib retracement level provides the next resistance at $1.23.
If bulls break higher, they could retest the $1.28 and $1.35 price levels.
Conversely, ADA/USD might retreat and rely on initial support at $1.13. Any more losses could force bulls to defend gains at $1.10, with recent lows of $1.06 providing a formidable support zone.
If the MACD fails to turn positive and the 4-hour RSI dips further below 50, ADA/USD could plunge below $1.00. In this case, sellers will target the $0.90 support level.