An analysis from a digital asset researcher suggests Cardano could be gearing up for a potential recovery to $0.23 following ADA’s rebound above a crucial support level.
In a technical analysis shared by its digital asset research arm, More Crypto Online highlighted Cardano’s rebound around the $0.1824 support level. The accompanying four-hour chart shows that the bounce occurred near the 61.8% Fibonacci retracement level of the preceding decline.
However, the researcher cautioned that the rebound alone does not confirm a market bottom, as ADA must overcome several resistance levels to strengthen its recovery prospects.
ADA Faces Resistance Between $0.1953 and $0.2039
More Crypto Online identified the $0.1953 to $0.2039 range as ADA’s next major hurdle. This zone corresponds to the 38.2% and 61.8% Fibonacci retracement levels of Cardano’s latest decline.
Consequently, ADA must demonstrate sustained strength within this range to establish whether the rebound can develop into a more prolonged recovery.
A decisive break above $0.2039 would improve the short-term outlook and bring the next resistance at $0.209 into focus, according to More Crypto Online. Beyond that level, ADA could target the broader resistance zone around $0.2302, aligning with the potential recovery target of $0.23.
Meanwhile, Cardano currently trades at $0.1874, requiring a 22.83% gain to reach $0.2302. ADA last traded around this level in late October before mounting bearish pressure pushed the token below $0.20.
The broader crypto market downturn has continued to weigh on the asset. At press time, ADA has declined 1.48% over the past 24 hours, highlighting the challenges it faces in sustaining its latest rebound.
ADA Risks Another Decline if Support Fails
On the downside, More Crypto Online identified the $0.1617 to $0.1824 region as a broader support area if selling pressure resumes. Therefore, ADA’s ability to defend the $0.1824 level could prove crucial to maintaining the recovery attempt.
Although the rebound offers some encouragement, the researcher emphasized that a bounce from a Fibonacci level does not establish a definitive market low. Instead, ADA must sustain its upward momentum and overcome the overhead resistance zone to strengthen the bullish outlook.
Meanwhile, another analyst, KCM, has warned that a significant supply wall could intensify bearish pressure on Cardano. The analyst identified a substantial sell-order block between $0.1949 and $0.1970, suggesting that the selling pressure in this region could push ADA back toward $0.1824.
However, ADA’s performance in the coming days remains uncertain as investors await the outcome of the U.S. midterm elections, which could influence broader market sentiment.