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Technical Analysis of Cardano ADAUSD November 2018 feature image

Technical Analysis of Cardano ADAUSD November 2018


Currently sitting at number 8 position on coinmarketcap.com is Cardano, with a 1.85 Billion Dollar market capitalization. The team at Cardano which comprised of the highest number global engineers and researchers boast of developing a smart contract platform with different features. On the contrary, speculators, traders and investors are more interested in following the money. Read on to get our views on the technical price action setups that move the pair.

Are you looking for more technical analysis? See our technical analysis blog for all our technical analysis.

Technical Analysis of Cardano ADAUSD November 2018

ADAUSD: Monthly Chart

Technical Analysis of Cardano ADAUSD November 2018 monthly chart

It is no news that almost all the top 50 cryptocurrencies enjoyed the bullish rally of November/December 2017. Cardano was not left out as its monthly price chart shows a bullish accumulation pattern on December 2107. An inverted pin-bar candle pattern sends the pair dashing down by an 86.64% drop. At the closing price of the month of September, price formed a bearish accumulation pattern that we expect to keep the exchange rate of ADAUSD in a bearish trend. A further weakness of the bullish accumulation pattern is increasing as price attempts to close below the price low of December 2017.

ADAUSD: Weekly Chart

Technical Analysis of Cardano ADAUSD November 2018 weekly chart

Starting from 15th January 2017, a bearish accumulation pattern was triggered, coinciding with the inverted pin-bar on the monthly chart. This established a resistance level at 0.933 leading to a price drop of 88.26% compared to a risk of 54.14%. Price later breaks out of a bullish inside bar on April 09, followed by a bearish accumulation swing with resistance at 0.283. The successive higher highs of the MACD oscillator compared to the successive lower highs of price signals a buildup of a potential divergence pattern.

ADAUSD: Daily Chart

Technical Analysis of Cardano ADAUSD November 2018 daily chart

Moving lower to the daily timeframe, the exchange rate of ADAUSD is tossed between both bullish and bearish divergence patterns. On September 19, price broke out of a bearish accumulation pattern, as a confirmation of the bullish regular divergence. The bullish regular divergence could not move price beyond being a price correction, and it eventually gave way to a bearish hidden divergence pattern on October 10.


Technical Analysis of Cardano ADAUSD November 2018 H4 chart

After the formation of bullish accumulation formed on October 20, an opposite bearish accumulation pattern followed by a breakdown of the bullish accumulation was triggered on 21st October, pushing the price below the 65-period moving average. As price oscillates under the moving average, a bearish hidden divergence pattern was signalled on October 27. The pair stayed within the bearish trend till it a final breakout of bearish accumulation on the 31st of October.

This breakout pattern is such that could last into a new bullish trend direction, however, the MACD oscillator is already making a new high, indicating possibilities of a bearish hidden divergence on the way. As always, we wait for an opposite price breakdown pattern to confirm this, or a dead cross of the MACD oscillator itself.


Technical Analysis of Cardano ADAUSD November 2018 H2 chart

The same bearish hidden divergence pattern formed on the 4-hour chart is equally formed on the 2-hour chart, a vote of confidence in the bearish direction. A breakdown of bullish accumulation within the bearish trend shows more seller activity. Similar to the 4-hour chart, another bearish hidden divergence is in view but not yet confirmed. Patience they say is a virtue, so again we wait for a dead cross to confirm this.

Conclusion and Projection

On the last day of October, a breakout of bearish accumulation pattern was fired up, indicating a sudden change in trend. Despite the final confirmation of the bearish divergence pattern, it was again proved that not all technical patterns have a hundred per cent win rate. The bearish hidden divergence pattern failed to another breakout of bearish accumulation on November 4, indicating an end to a bearish retracement.  The chart below shows the risks exposure upon entering a long buy trade on the first breakout of bearish accumulation (31st October).

At the end of the month of October, the price for the first time closed below the bullish accumulation pattern of December 2017, which happens to be a significant level for the pair.

The pair already appears to be oversold, hence the reversal experienced at the moment. A major continuation of the bearish trend will be confirmed on the weekly chart, and for now, the midterm direction is bullish. Check out the attached daily chart for a projection on the long-buy entry, also note that our first profit target is already achieved from the 4-hour chart, hence our stop loss is at the breakeven point.

ADAUSD: 4-HOUR Chart Update

Technical Analysis of Cardano ADAUSD November 2018 H4 chart update

ADAUSD: Daily Chart Update+ Projection

Technical Analysis of Cardano ADAUSD November 2018 daily chart update

If you are interested in reading an updated version of the Techincal Analysis of Cardano (ADAUSD) from April 2019 we have it available on our blog also.

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