Cardano (ADA) price action might be seeing bulls fighting back a little bit with a green candle again for the week and at the start of a new month. That is as far as good news goes as it does not look like ADA price will be able to close the week above the previous week, and thus instead simply keeps continuing to trade in the downtrend that is squeezing bulls against $0.415. Risk to the downside comes with the possibility that the Fed will step up its rate hike plan, triggering an even stronger dollar and adding another wide range lower to the ADA price valuation.
Cardano price looks no match and is not up to the task of trading profitable in this current macroeconomic environment. With still elevated inflation, wages are being eroded with little money left to spend on cryptocurrencies. The first cycle of that cash draining triggered the drop for Cardano price action to slip below $1.00.
ADA price has been finding a floor near $0.415 as that level caught a falling knife in May and saw bulls try to trigger a bounce off that level this week. Unfortunately, that bounce is not strong enough, and with the 55-day Simple Moving Average hanging over the price action as a cap, price action looks set to slip lower in the coming weeks with first up the monthly S1 at $0.383, which falls in line with that falling-knife-low of March. Based on the monthly pivots for September, losses could go as far as the monthly S3 near $0.20, with $0.075 not far away anymore, and possibly be tested by November if the current dire economic situation persists.
ADA/USD Weekly chart
A strong signal to the markets would be if Cardano price could start the week with an opening above the 55-day SMA, near $0.50. Bulls would jump in on that level as it will act as new support nearby, and offers a possibilty to rally to $0.600 nearterm. Longer-term $0.715 would be forecasted, although that would mean that something substantial changes or that cryptocurrencies are fully dislocated from the current macroeconomic backdrop.
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