Cardano is gearing up for another impulsive move to unprecedented prices, with support from a large base and bullish MACD divergence.
The broader crypto market has recovered slightly over the past 24 hours, with Cardano ($ADA) not left out. The 13th largest cryptocurrency by market cap has increased by 3.5% in this timeframe to $0.252, bringing its growth over the past week to 5.3%.
From a technical perspective, two factors are aligning for $ADA. If history repeats, then the current price could be considered an undervaluation compared to the coin’s growth prospects.
Key Points
- Cardano is setting up for another huge upside move backed by two distinct bullish developments on the $ADA/$USDT 3D chart.
- One notable point cited is the “huge base” being set up, which has cushioned weak price action for years.
- $ADA formed a similar base between 2019 and 2020, leading up to the massive rally to the 2021 peak.
- The MACD indicator is also forming a base, with a similar move preceding the 2020/2021 price expansion.
- Analysis highlights the possibility of a move toward $10 for $ADA.
Cardano Forms Large Base
Analyst Javon Marks noted in a March 31 tweet that Cardano is setting up for another huge upside move. To back this projection, the analyst highlighted two distinct bullish developments on the $ADA/$USDT 3D chart.
One of the notable points cited is the “huge base” that is being set up. An accompanying chart provides more context, showing that Cardano has been forming a massive support area for several years now.
Notably, this base cushioned the bearish price action as the coin fell from its current ATH of $3.10 in 2021. From the high, $ADA dropped by over 90% to $0.239 in December 2022, then quickly rebounded. The coin retested this support again in June 2023, dipping to $0.220 before a similar recovery kicked in.
This local support has since served as a bottoming area, with subsequent revisits followed by a notable bounce. Marks believes that holding this base is bullish, especially given historical precedent.
For context, $ADA formed a similar base between 2019 and 2020, leading up to the massive rally to the 2021 peak. It last touched this base when it reached the March 2020 low of $0.0177, and what followed was an over 14,705% increase to $3.10.
Bullish MACD Trend
Marks further identified the moving average convergence divergence (MACD) trend. Notably, the indicator is also forming a base, as seen in the price, with a similar move preceding the 2020/2021 price expansion.
Meanwhile, a bullish divergence is also very obvious. While $ADA’s price has made lower lows along the base, the MACD line has made higher lows. This divergence indicates that while the asset’s price is weak, bears are losing control of the market, and selling pressure is waning.
A combination of its hold above this long-term base and the bullish divergence could set Cardano up for another price expansion. Marks’ chart highlighted the possibility of a move toward $10 for $ADA, representing a 3,868% increase from the current market price.
