Cardano going through massive price surge, and it is not stopping
Cardano's native cryptocurrency, ADA, is making headlines with an unanticipated surge in its price. The latest daily chart showcases ADA's fierce battle with a significant technical indicator: the 200 Exponential Moving Average (EMA).
As traders and enthusiasts scrutinize market movements, many are eagerly waiting to see if this digital asset can push past this crucial level and secure a breakthrough.
Source: TradingView
The 200 EMA is a popular technical indicator used by traders to determine the overall trend of an asset. Historically, assets trading above this line are seen in a bullish phase, while those trading below are in a bearish phase.
Per the latest data, ADA seems to be tussling with this line, indicating a potential pivotal moment for the cryptocurrency. If ADA manages to close above the 200 EMA and maintain its position, it could signify a bullish turnaround after a relatively prolonged downtrend.
While the recent price surge is undoubtedly positive news for ADA holders, there are other aspects of the chart that deserve attention. Notably, the descending volume profile indicates reduced trading activity during this upward price movement.
Typically, a rising asset backed by increasing volume is a more robust bullish sign, as it reflects broader consensus on the market. Conversely, an uptrend on decreasing volume might suggest that the move lacks substantial support and could be short-lived.
Adding to the concerns is the Relative Strength Index (RSI), which has hit a value of 79. Generally, an RSI value above 70 is considered overbought, suggesting that the asset might be due for a pullback or consolidation. With ADA's RSI nearing 80, traders should exercise caution, as this indicates the asset might be overextended in the short term.