ADA → Cardano Heading for $0.65!? In a Key Support Zone.ADA completed its 2-legged pullback per my previous analysis and even overshot the key support zone to Push #1 support at $0.41. Is this an opportune time to long?
Previous Analysis:
How do we trade this? 🤔
Cardano found support at Push #1 support from the previous bull trend around $0.40 and has rebounded to the Daily 200EMA. It's reasonable to expect a pullback from the 200EMA to the $0.45-$0.47 area in the Support Zone. We need a strong bull candle closing on or near its high followed by a confirmation candle to support the idea of longing ADA. Even with such price action, we should be cautious given Bitcoins likely pullback from its recent all-time high and halving period.
That being said, it's reasonable to think Cardano will have more upside before it comes down and with the signal and confirmation bar off of the Support Zone, it's reasonable to enter a long position toward the $0.65 range. Take half profits at 1:1 Risk/Reward at $0.5635, move the stop loss up to the entry price, then swing the latter half of the position to Take Profit #2 target of $0.65. The likelihood of hitting $0.65 is less than ideal, but it's worth holding that second take profit target until the price action gives us a reason to exit the trade.
This analysis is in alignment with my recent ADA Lifetime Analysis as seen here:
💡 Trade Idea 💡
Long Entry: $0.4767
🟥 Stop Loss: $0.3900
✅ Take Profit #1: $0.5635
✅ Take Profit #2: $0.6500
⚖️ Risk/Reward Ratio: 1:2
🔑 Key Takeaways 🔑
1. 2-Legged pullback completed at Support Zone.
2. Double Bottom pattern at Support Zone
3. Strong bull candle to Daily 200EMA, expect a pullback to the Support Zone.
4. Look for a strong signal candle closing on or near its high with a confirmation candle following.
5. RSI is at 41.00 and above the Moving Average, supporting the idea of a long position.
💰 Trading Tip 💰
It's reasonable to take half profits at the first resistance target in a long trade or the first support target in a short trade. Using a 1:1 Risk/Reward Ratio for your first target, you can move your stop loss up to your entry price, locking in profits. This allows you to watch the rest of the trade execute without worrying about losing money, which helps improve trading psychology and the equity in your account.
⚠️ Risk Warning! ⚠️
Past performance is not necessarily indicative of future results. You are solely responsible for your trades. Trade at your own risk!
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