CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 81.76% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

81.76% of retail investor accounts lose money when trading CFDs with this provider.

Crypto Update: Cardano holding after key support test

Published: 02.02.2022
by Joseph Jeffriess

Today we’re looking at Cardano (ADA) as price continues to hold above key support after January’s test.

Currently, price has started to pull back most of today’s losses so the bar below is not as bearish as it is shown. We look to be at a bit of a crossroads with price holding above key support but remaining in a well-established downtrend. These situations are normally good as hopefully, something will have to give at one point, and we will see some direction.

On the short-term things remain on the bear’s side with a fast trend break and the fast move back down to key support. For now, price remains held in a pennant pattern and since the current (shot) trend is down will look to see if sellers can confirm a breakout lower. Their wall remains key support. You have to go back to February 2021 for the last time price was below this support level and that was during a firm up leg that ended up forming the first point of the level.

Our outlook is quite clear, while support holds we will look for buyers to either form a new push higher or enter into a battle with sellers that could set up a new range above key support. If sellers can break support that would be a development and could set up a new leg of the downtrend that may threaten a new move back to .90 or lower.

Cardano D1 Chart

* The information provided on this page are the opinions of the author and do not necessarily reflect the opinions of Eightcap and are not endorsed by Eightcap.

Any person acting on the information presented on this page does so entirely at their own risk. No representation or warranty is given as to the accuracy or completeness of this information. Any research provided does not have regard to any specific investment objectives, financial situation and needs of any specific person who may receive it.

Margin trading involves a high level of risk and may not be suitable for all investors. You should carefully consider your objectives, financial situation, needs and level of experience before entering into any margined transactions with Eightcap, and seek independent advice if necessary.