Cardano ADA at support but looking weak
Updated
Context:
1 Bulls take control for the first time in 2018.
2 Price hits resistance and is met by aggressive selling.
3 Price is now consolidating at a previous support and a potential place of value (also a 61.8 fib retracement of 1 and 2). This is assuming that the bulls will be able to regain control of the market in the near-term. Judging by the consolidation, the bears seem to be gaining ground and I will be watching closely for continuing signs of weakness. I am long at 0.2334 but because the bears have been steadily gaining, I have a wide stop slightly beyond what I view as the next support zone 4. If a breakdown of 3 looks eminent, I may also try to exit the trade early and look to buy at either the next support zone 4 or buy back in at 3 in the case of a false break. Considering BTC, ETH, and other crypto charts and the fact that ADA is showing signs of weakeness after strong selling pressure, a move down to 4 would not surprise me so my strategy is to be pretty flexible with the trade I currently have open.
In summary, I think the chances of support holding is about 50/50. In support of the bulls, we have a 61.8 fib retracement and a probable level to buy a pullback. Against the bulls we have signs of weakness during the consolidation and the fact that the bulls haven't had much success the entirety of 2018--I'm not entirely convinced we've even hit the bottom of the 2018 correction but I am willing to open bullish trades at locations that have a reasonable chance of succeeding. There is also the fact that the crypto market often moves in unison and there are several other major coins that could still fall (taking ADA down too) before buyers step in.
1 Bulls take control for the first time in 2018.
2 Price hits resistance and is met by aggressive selling.
3 Price is now consolidating at a previous support and a potential place of value (also a 61.8 fib retracement of 1 and 2). This is assuming that the bulls will be able to regain control of the market in the near-term. Judging by the consolidation, the bears seem to be gaining ground and I will be watching closely for continuing signs of weakness. I am long at 0.2334 but because the bears have been steadily gaining, I have a wide stop slightly beyond what I view as the next support zone 4. If a breakdown of 3 looks eminent, I may also try to exit the trade early and look to buy at either the next support zone 4 or buy back in at 3 in the case of a false break. Considering BTC, ETH, and other crypto charts and the fact that ADA is showing signs of weakeness after strong selling pressure, a move down to 4 would not surprise me so my strategy is to be pretty flexible with the trade I currently have open.
In summary, I think the chances of support holding is about 50/50. In support of the bulls, we have a 61.8 fib retracement and a probable level to buy a pullback. Against the bulls we have signs of weakness during the consolidation and the fact that the bulls haven't had much success the entirety of 2018--I'm not entirely convinced we've even hit the bottom of the 2018 correction but I am willing to open bullish trades at locations that have a reasonable chance of succeeding. There is also the fact that the crypto market often moves in unison and there are several other major coins that could still fall (taking ADA down too) before buyers step in.
Note
So far the bulls are definitely loosing this battle, if the current reaction is particularly weak, I will consider exiting the trade, and waiting to enter after failed break to the downside or at the next S/R zone.Note
My current buy zone BTC is ~7500 -- a drop to this level may take ADA with it, breaking (or at least false breaking) support at 3.Note
Cross-checking the daily ADA chart PA w/ an ichimoku cloud also puts current price at the low end of cloud support.Note
Cross-checking the daily ADA chart PA w/ an ichimoku cloud also puts current price at the low end of cloud support.Note
Price has been stuck under a minor resistance level for 7 hours--very weak IMO though I still think this level could attempt to breakdown and fail/turnaroundNote
Price has broke out of the structure and is attempting to break out of the support zone. For now, I'm leaving my current trade open and If this turns out to be a false break, I will also open an intraday trade with a tight stop if price makes it back into the corrective structure.Note
This is roughly where I will go for an intraday trade on an hourly or 5m chart is t.his turns out to be a false break and get back above intraday support. Minimum, I will target the recent lower-highs for about 2R. A 3R trade to the top of the rectangle is also possible.Note
Closed my trade w/ just a tiny loss--I think ADA is likely going to test the next resistance level but if price is able to get back into the structure I'll consider buying in. I'm becoming increasingly bearish----we've seen very little pushback from the bulls so far
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.