Cardano (ADA) May Experience Short-Term Correction for Long-Term Gains

Kenshiyesreel, a crypto analyst, has taken a short position on ADA, which aims to pull the price back towards the $0.45-$0.50 region for accumulation.

Cryptocurrency prices are highly volatile and can change rapidly. Several factors influence ADA’s price, including technical analysis, market sentiment, and news.

One crypto analyst, Kenshiyesreel, has taken a short position on ADA, aiming for a price pullback to the $0.45-$0.50 zone for potential accumulation.

However, technical indicators like the Golden Cross suggest a possible continuation of ADA's bullish trend if it manages to stay above critical support levels.

Short-Term Dip for Long-Term Gains

According to Kenshiyesreel’s analysis, the current price action of ADA shows a completion of the "falling wedge" pattern, usually indicating a trend reversal to the upside.

However, the analyst anticipates a short-term dip, which could provide an optimal entry point for purchasing between $0.45 and $0.50, where ADA might encounter selling pressure.

The analysis also includes a target of $1.2 if the upward trend continues after a price pullback.

Bullish Indicators Emerge in ADA’s Daily Chart Analysis

In the daily chart pattern analysis, the recent formation of the Golden Cross, where the short-term moving average crosses above the long-term moving average, also portrays a bullish pattern.

ADA’s price surged to a high of $0.63 before retracing to $0.5947 and trading above both the 9-day and 21 moving averages (MAs).

Possible support levels are around $0.5464 and $0.4663 if the price turns bearish.

The Money Flow Index (MFI) is 69.66, indicating the markets are bullish, but the index is getting close to being overbought. Usually, when the MFI reaches 70, it could indicate a potential bearish reversal if buying pressure drops.

This balance between buying strength and overbought risk suggests that ADA may experience short-term volatility, while long-term indicators still suggest a positive outlook.

ADA’s Key Support Levels and Potential for Bullish Breakout

In case ADA support holds above $0.5464 it might propel to break the recent high of $0.63 up to the $0.70 resistance level.

Prices above $0.63 could drive the price higher, supporting the medium-term bullish outlook.

However, if ADA loses support around $0.5464, a drop to the 21-day moving average at $0.4663 could occur, signaling a deeper retracement.

Further evidence from the analyst chart shows that Fibonacci retracement levels of 50% and 61.8% support these zones as buy levels.

Kenshiyesreel’s short position and $0.45-$0.50 accumulation target fit within these retracement levels, indicating that this price area could attract buying interest.

In other ADA price analysis, analyst Ali also shared his predictions, stating that the cryptocurrency has the potential to hit a price of $6 by July-September next year, 2025.