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Launched in 2015, Cardano (ADA) was created by engineers/scientists and aims, like Ethereum or Neo, to deploy decentralized applications and smart-contracts. Cardano directly attacks Ethereum by trying to solve the scalability problems encountered by the network. In addition, they want to solve all the problems encountered by other protocols using the Blockchain (security, costs, scalability). Cardano’s ICO amounted to $62 million.
Analysis
➡ As it can be seen on the graph with the orange rectangle, ADA has had a very good support between 1700 and 1900 satoshis.
After breaking it in August 2018, ADA followed a steady decline of up to -50% in its value. Using the Fibonacci retracement, we can see that since the summer of 2018, we have been in the area between 78.80% and 100%.
➡ A study of the daily chart shows that ADA would eventually form a “Cup & Handle”. The “Cup” was formed from August 2018 to April 2019 and we would currently be in the middle of the “Handle”. It should be noted that this type of configuration is considered bullish.
➡ How to position yourself?
- The “Handle” could still continue to drive prices down to 1353 satoshis, which also corresponds to an old resistance that was hit 3 times before being broken at the end of March 2019. This old resistance can therefore play the role of an important support. If you go back to this level, a stop-loss at -12% (around 1191 satoshis) would be interesting.
- In the event that ADA starts to rise again and breaks its upper oblique resistance, it would be interesting to take a position also just above this resistance. However, beware of false fakeout.
➡ Where to place your Take Profit? (TP)
The first should be in the area mentioned at the beginning, between 1700 and 1900 Satoshis. Indeed, it is a very strong resistance and therefore it is not unlikely that ADA will encounter it before falling back. In the event that ADA succeeds in breaking this resistance, the next target would be the 78.69% Fibonacci threshold and finally a third target at the 61.80% Fibonacci level. Remember to place your TPs slightly below these thresholds. In terms of gain, we can expect a 30% in TP1, a 70% in TP2 and finally a 165% in TP3. Attention these are estimates and it is obviously necessary to monitor ADA and its evolution. This is a trading plan and not a prediction.
Summary
- ADA/BTC (Binance) would be forming a Cup & Handle (bullish figure)
- Follow the evolution and place yourself either around 1353 satoshis (old big resistance) or above the handle’s oblique resistance.
- TP1 : 1783 / TP2 : 2300 / TP3 : 3505
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