Cardano (ADA) is currently up over two percent and trading close to the $1.20 level. The important support area to watch is between $0.83 and $1.06. There are two possible routes for ADA from here.
Path 1: the price remains higher
In this scenario, the ADA could continue to rise directly in a five-wave move to complete wave five of the larger third wave. This move could push the ADA to levels around $1.42 and possibly even $1.72 before a bigger correction begins in the fourth wave. After that, a wave five rally could take place.
Path 2: Greater unfolding of the fourth wave
The second possibility is that ADA is already in the larger fourth wave. In this case, the price forms an ABC structure as part of wave four. Both routes are plausible, but the first option, with a further push, seems to be preferred.
Important support level to keep an eye on
The key support level to watch is $0.64, which is a 50% retracement of the rally that started in November. If the ADA falls to this level, it would mark a more significant pullback before the next rise. The price could also move higher in the near term before testing this support.
Short-term movements and market influence
In the short term, ADA may show some fluctuations as these are closely linked to Bitcoin’s performance. Bitcoin’s dominance is currently waning, allowing altcoins like ADA to recover. However, ADA’s next resistance zone is between $1.15 and $1.27. This area could create some resistance as it aligns with previous price levels and volume profiles.
Resistance and future goals
If ADA is rejected in the $1.15 to $1.27 area, a possible decline in a five-wave structure could lead to a C-wave to the downside. In that case, ADA could find support around $0.76.
