The Cardano price is approaching a key resistance level as cryptocurrency prices rebound. ADA surged to $1.3715, which was about 33% above the lowest level this month. The coin is valued at more than $43 billion and is the 5th biggest digital currency in the world.
ADA price surge
Cardano price is surging as the rest of the cryptocurrencies bounce back. Bitcoin, Ethereum, Ripple, and Binance Coin prices have all risen by more than 8% in the past 24 hours.
The total market capitalization of cryptocurrencies tracked by CoinMarketCap has surged to more than $1.5 billion. This performance is driven by Bitcoin, whose market value has risen from less than $600 billion a week ago to more than $715 billion today.
Most altcoins have a close correlation with Bitcoin. Therefore, to explain why ADA has jumped, it is important that we look at some of the key reasons why Bitcoin has risen.
First, there is the monetary situation in the US. As the number of Covid cases rises, there are concerns that the Fed will sound hawkish in its Wednesday’s meeting. This is evidenced by the fact that the 10-year bond yield has retreated to 1.25% while the 30-year yield has dropped to 1.90%.
Second, there are rumours that Amazon will start accepting Bitcoin and even launch its own token soon. This will be a major issue if the company confirms the rumours because of its role in the world economy. It has hundreds of millions of users and is the fourth-biggest company in the world. The news coincides with reports that Tesla too is considering re-accepting Bitcoin.
Third, the Cardano price is rising as volume returns. As shown below, volume in most exchanges like Coinbase, Binance, and OKEX has jumped by more than 100% in the past 24 hours.
Finally, investors are excited about the recent hard fork in Cardano’s network. The fork, when complete, will enable Cardano to have smart contracts, which will make it possible for developers to build decentralized apps.
Cardano price prediction
The daily chart shows that the Cardano price has bounced back in the past few days. It has also found substantial support at the $1.0226 level. The coin is also attempting to move above the resistance at $1.4960. It is also attempting to move above the 100-day and 50-day moving averages. A closer look shows that the price has formed a head and shoulders pattern.
Therefore, while the current upward bounce is welcome, I believe that the coin is not yet in a buy zone. It will move into this region when it moves above the right shoulder at $1.4960. Unless this happens, we can’t rule out another major decline below the support at $1.0226.