Disclaimer: The information presented does not constitute financial, investment, trading or any other advice and is solely the opinion of the author
- ADA’s price action was rejected on a major bearish order block.
- Mixed signals in the futures market call for patience and caution.
Cardano [ADA] has made up for all the gains made in April, sending the asset into a troubling start to Q2 2023. Particularly in the first half of April, ADA rose from $0.3700 to $0.4614 – about a 25% increase.
However, gains were lost in the second half of April after ADA dropped and retested the bullish order block and support range of $0.3700 – $0.3800 (Cyan).
Is your wallet green? account ADA Profit Calculator
Given the May 2-3 FOMC meeting, the first week of May will expose ADA to some volatility. At press time, Bitcoin [BTC] consolidated below USD 30,000, a repeat of near-term bullish sentiment.
ADA could sink lower if BTC’s bullish sentiment is slightly eroded after the FOMC announcement. Rather, ADA could rise if BTC reclaims the post-meeting $30,000 zone.
Will the retracing be extended?
Source: ADA/USDT on TradingView
On April 14, ADA broke above February’s main bearish order block (OB) of $0.4200, but was rejected near the $0.4614 confluence area. The uptick saw ADA gain 9% from its Q1 2023 peak value.
However, the decline and subsequent bearish breakout of the ascending channel (yellow) pushed ADA back to its early April range of $0.3700 – $0.4200. At the time of writing, the asset fell slightly after reaching the bearish OB of $0.4200 and may attract more sellers.
As such, ADA could retest April’s range support and demand zone of $0.3700 – $0.3800 (Cyan). The retest could open new buying opportunities, especially if ADA falls back to $.4200 or higher. However, the FVG (fair value gap) zone of $0.4251 – $0.4333 (White) could also delay any rebound above $0.4200.
Conversely, ADA could fall to $0.3490 or lower if support bursts, eroding bullish sentiment.
Meanwhile, RSI has been oscillating around the neutral level since last Friday (April 28), showing indecision between buyers and sellers. But OBV and volume have been falling since April 27, showing that buying pressure has eased over the same period.
Mixed signals in the futures market
Source: Coinglass
How many are 1,10,100 ADAs worth today?
Liquidations fluctuated between longs and shorts on April 29, according to Coinglass, indicating neutral sentiment in the futures market.
But there were more liquidations of short positions than long positions at the time of going to press. In addition, the long/short ratio on the exchange showed that the dominance of longs was 53.95% in a 4-hour timeframe – a slight near-term bullish sentiment.
Due to the mixed signals, investors should follow BTC for clarity in addition to caution.
Source: Coinglass
