Analyst Shares What Cardano Needs to Do to Turn Bullish

A recent analysis suggests that Cardano must reclaim two crucial indicators to turn bullish amid a fifth consecutive week of price downtrend.

For context, Cardano has been correcting since the week of May 12 after hitting a high of $0.86. ADA sustained upward momentum for five weeks before the peak week, swelling 68% from an April 7 low of $0.51 to the high.

However, the tenth-largest cryptocurrency by market cap has decoupled from Bitcoin’s bullish trend, correcting nearly 27% from the $0.86 high to its current price. This places Cardano well within bearish territory.

Trend Below EMA34 and MA200 Bearish for Prices

Meanwhile, the correction has seen it trend below the 34-period exponential moving average (EMA34) and the 200-day moving average, two major trend indicators. Crypto analyst MasterAnanda highlighted this bearish bias in a recent TradingView analysis.

He noted that Cardano’s current standing between the two major trend indicators puts prices in bad shape. According to him, this makes ADA’s price look weaker compared to XRP and Ethereum. Also, he suggested Cardano could continue its bearish trend in the short term.

However, he highlighted that ADA has retraced for five consecutive weeks and may be nearing its point of price reversal. With the market seeking balance and the 27% correction already large enough, the asset could be eyeing a rebound.

Crucial Price Cardano Needs to Reclaim

Nonetheless, MasterAnanda identified the price level that Cardano needs to reclaim to regain bullish momentum. In the TradingView analysis, he stated that all things change for ADA if it regains or closes above the $0.68 and $0.70 price range.

Currently, the ADA’s EMA34 in the 1W chart stands at $0.70, while the MA200 is at $0.67, closely aligning with the range. As a result, the analyst noted that Cardano must reclaim this range and moving averages if it is to reverse predominant bearish trends.

Until then, the market watcher advised patience, especially for investors. Notably, at the current price of $0.62, a surge to the range would see ADA rally 10% and 13%.

Two Supports to Monitor

Meanwhile, analyst CryptoPulse has identified two supports to look out for amid Cardano’s bearish trends. In a parallel commentary, he highlighted the token’s trend within a descending triangle and levels to watch if price weakness persists.

An accompanying chart shows that the base of the triangle, which aligns with a major daily support, is one to watch. The demand area currently lies between $0.50 and $0.55, an area ADA has retested on two occasions this year, specifically in early February and April.

However, if support breaks, the analyst shared that the next major support is between $0.42 and $0.50. This support aligns with an ascending long-term trendline and was a former resistance for ADA before it broke free in November.

CryptoPulse noted that this area would be a good buy zone for ADA. Meanwhile, if the supports hold, he suggested that Cardano could reverse to retest the descending triangle’s resistance at the $0.71 and $0.75 area.