#Cardano currently battling suppression within a channel in the hourly chart, with a recent support rebound keeping hopes of a breakout alive.
Cardano (ADA) defended the $0.33 support level during the Sunday market downturn amid fears of another US government shutdown. Having rebounded from this level, it now targets the upper boundary in its current price structure.
Key Points
Cardano is suppressed within a channel in the hourly chart, with a recent support rebound keeping hopes of a breakout alive.
ADA defended the $0.33 support level during the Sunday market downturn, amid fears of another US government shutdown.
Prices are tightening within the broader descending channel, suggesting a volatility squeeze in preparation for a directional move.
If the current momentum holds, ADA could target the channel’s upper resistance level at $0.38.
A drop below the $0.33 price level, which is the lower support boundary, would invalidate this move.
Cardano Bulls Keep Breakout Hopes Alive
Notably, the January 25 decline saw Cardano drop to the lower support trendline of a descending channel. It dropped to a low of $0.33, which aligned with the $0.33-$0.32 demand zone.
However, bulls stepped in as they did during the previous retest on January 19 to prevent prices from falling below the trendline support. So far, ADA has rallied 6% from the low to its current market price of $0.35.
Meanwhile, prices are tightening within the broader descending channel, suggesting a volatility squeeze. This also indicates that Cardano may be preparing for a directional move, potentially breaking out of the structure.
Key Levels to Watch
Cardano defended the $0.33 support violently and swiftly, suggesting momentum is building. If the current momentum holds, then it would target the channel’s upper resistance level at $0.38.
The token last retested this level on January 14, when it reached a high of $0.42 but couldn’t conquer the selling pressure there. Closing above $0.38 would pave the way for a move to higher prices, such as $0.40 and $0.50. However, this remains uncertain, as current momentum might stall or the resistance prove too strong.
A drop below the $0.33 support would invalidate this move. This would mean a drop below the structure’s lower band, with further downsides for Cardano in the short to medium term.
Remarkably, ecosystem development looks positive for ADA. Founder Charles Hoskinson recently hinted at another major integration for Cardano, with rising transaction volume adding to the optimism. For context, the mainnet has processed over 118 million transactions, signaling traction.
Nonetheless, the next direction for the Cardano price depends more on the broader market mood than on its individual progress. If Bitcoin remains choppy, the broader altcoin market is likely to correct with it.
