A bullish price action could be imminent for Cardano, as a recent analysis identifies a recurring pattern that previously triggered an explosive move.
Cardano is on the verge of recording a massive northward push, an analysis from Crypto Patel highlighted. The November 19 commentary identified that a pattern that spurred an over 3,000% rally for ADA is forming again on the weekly chart, and a repeat would be massive for the coin.
History Repeating for Cardano
Notably, the analysis comes as Cardano looks poised to post its fourth weekly red candlestick. During this period, which spans from late October, ADA has corrected from a high of $0.693 to its current market price of $0.467.
However, Crypto Patel highlighted that ADA has now reached a bullish order block, one with a history of marking the start of a parabolic expansion for the cryptocurrency. If past precedent is anything to go by, then he believes Cardano could fly from here.
For perspective, ADA saw a similar pattern during the previous cycle. In May 2020, it broke out of a descending trendline, sparking a rally past a former resistance zone around $0.107.
After breaking out to a high of $0.155 in July 2020, it retested this zone and confirmed it as new support. Notably, this successful retest started a parabolic phase for Cardano, resulting in an over 3,000% rally to its August 2021 all-time high of $3.106.
Price Target If ADA Run Starts
A similar pattern has now emerged in the current cycle. Specifically, after Cardano broke out of a descending channel in November 2024 to reach a high of $1.327 in December, the cryptocurrency is now retesting a key support area. The OB, between $0.51 and $0.42, aligns closely with the former resistance trendline, serving as a crucial point for a bullish price development.
If ADA bounces from here, then it might repeat the price growth recorded in the previous occurrence. A 3,000% rally from the current market price would take ADA to around $14.5. However, this exact growth might not materialize due to ADA’s large market cap and the concept of diminishing returns.
Meanwhile, Crypto Patel highlighted three targets for the rally and a point of invalidation.
The first target is the resistance at $1.202, which represents a 157% gain. The second resistance target is at the $2.949 mark, culminating in a 531% increase from the current market price. Ultimately, he predicts a rally to $5.811, which would mark a 1,144% growth from here.
However, the analyst highlighted that a dip to $0.35 would invalidate this pattern. ADA would have to fall another 25% from its current market price to reach this level.
DisClamier: This content is informational and should not be considered financial advice. The views expressed in this article may include the author's personal opinions and do not reflect The Crypto Basic opinion. Readers are encouraged to do thorough research before making any investment decisions. The Crypto Basic is not responsible for any financial losses.
