Cardano (ADA) Price Stalls at Horizontal Resistance Despite Yearly High

Key Takeaways

• ADA has likely completed wave (3) at $1.20, reaching the 1.618 Fib extension.
• Overbought RSI suggests a possible wave (4) correction or consolidation.
• Support lies at $0.985, $0.860, and $0.758, maintaining the bullish structure.

Cardano (ADA)) has experienced an extraordinary rally, breaking free from its prolonged corrective phase in 2024 and forming a solid foundation near $0.24.

This surge propelled ADA into wave (3) of its Elliott Wave structure, reaching a new yearly high of $1.20 on Dec. 2. It showcased significant bullish momentum supported by a breakout from a descending triangle.

ADA Price Analysis

Cardano’s price has displayed a remarkable rally, breaking out from its prolonged corrective phase throughout 2024.

After forming a solid base of nearly $0.24, the price surged, completing wave (3) of a larger Elliott Wave structure and reaching a high of $1.20 today, Dec. 2. 

This sharp upward move reflects significant bullish momentum, marked by a decisive breakout from a descending triangle and strong buying pressure.

However, it reached a key horizontal zone, and with some signs of overextension, the rally might end. 

The Relative Strength Index (RSI) is overbought territory, suggesting a possible cooling-off phase or consolidation before the next significant move. 

Fibonacci extensions indicate wave (3) has reached a typical 1.618 extension at $1.20, with potential wave (5) targets at $1.57 and $1.76 (2.272 and 2.618 Fibonacci levels).

However, wave (4) retracement to lower Fibonacci levels is anticipated before further upside.

Key Observations

Wave (3) Completion: ADA has likely completed wave (3), reaching a high of $1.13, with the 1.618 Fib extension acting as resistance.

RSI Overbought: The RSI indicates overbought conditions, indicating a potential wave (4) correction.

Support Levels: Key support zones lie at $0.85 (0.786 Fib) and $0.72 (0.618 Fib), critical for maintaining the bullish structure.

ADA Price Prediction

Zooming into the hourly chart and examining the wave structure behind the last uptrend, we can see that ADA completed wave (3) of a larger impulsive.

The rally shows signs of exhaustion, confirmed by rejection at the Fibonacci extension level and wave (v) development within wave (3).

The price action now transitions into a corrective phase, with an anticipated ABC structure to retrace some gains.

ADA’s price is expected to consolidate or pull back to Fibonacci retracement levels, forming a foundation for the subsequent wave (5) and continuation of the bullish trend.

Depending on the momentum behind this correction, it could be shallow or extended by two more waves, amounting to a deeper ABCDE. 

Key Levels to Watch

Support Levels:

• $0.985 (0.236 Fibonacci): Immediate support and likely target for wave (4).
• $0.860 (0.382 Fibonacci): Strong support zone if correction deepens.
• $0.758 (0.5 Fibonacci): A critical level to maintain the broader bullish structure.

Resistance Levels:

• $1.130: Current trading zone and critical for confirming any upward recovery.
• $1.186: Recent high marking wave (3) completion, key for a breakout to wave (5).
• $1.415 (2.0 Fibonacci extension): A projected target for the wave’s next major impulsive move (5).

Finally, a sustained drop below $0.758 would challenge the bullish outlook. A decisive break above $1.186 could confirm the continuation of the uptrend into the wave (5).