Cardano price could revisit $1 as ADA threats multiply – FXStreet

Akash Girimath Akash Girimath
FXStreet

Cardano price has breached its consolidation range but is struggling to head higher. The presence of a resistance confluence makes this run-up an arduous task for bulls.
Cardano price traded between the $1.12 and $1 barrier for roughly two weeks, signaling a consolidation. On February 5, ADA breached through this sideways movement and produced a swing high above $1.12, flipping into a support floor.
Cardano price faces two critical hurdles as it trades above $1.12 – the weekly resistance barrier at $1.20 and the 50-day Simple Moving Average (SMA) at $1.24. Hence, the chances of an upswing are considerably less. 
Therefore, investors can expect Cardano price to face rejection at either of the two barriers and retrace lower. A failure to breach the 50-day SMA at $1.24 could lead to a 15% downswing to the daily support level at $1. This barrier served as a support platform for the run-up in mid-2021 that pushed ADA to $3. Hence, this stable support floor is where the downside could be limited. 
ADA/USDT 4-hour chart
ADA/USDT 4-hour chart 
Supporting this downward movement for Cardano price is IntoTheBlock’s Global In/Out of the Money (GIOM) model. This on-chain index shows that the immediate support level for ADA is non-existent and that a stable one is present at $1.03, further adding credence to the short-term bearish thesis. Therefore, investors can expect ADA to find a firm footing around this barrier where roughly 448,830 addresses that purchased 7.78 billion ADA are “In the Money.” 
ADA GIOM 
ADA GIOM 
Another reason why a bullish thesis Cardano price is unlikely is due to the decline in the number of large transactions from 5,100 to 4,900. This 3.9% drop, which serves as a proxy of their 
investment thesis, indicates that they are not interested in ADA at the current levels.
ADA large transactions
ADA large transactions
All in all, Cardano price seems ready for a quick leg down to $1, a crucial psychological level. This bearish outlook can be side-stepped if ADA bulls can produce a four-hour candlestick close above $1.24. 
Doing so will allow Cardano price to have a free reign up to $1.45 or a 17% upswing. The upside seems to be limited at $1.45, which is a confluence of the weekly resistance barrier and the 100-day SMA.
 

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