Key Takeaways:
- ADA price declined heavily below the $0.550 support zone.
- It broke a major bullish trend line with support near $0.532 on the daily chart.
- The bulls must protect the $0.400 support zone to avoid more downsides.
Cardano’s ADA started a major decline from well above $0.55. The price is now trading near a major support at $0.400, below which it could nosedive.
Cardano (ADA) Price Reaches Important Support
In the middle of this month, ADA saw a decent increase from the $0.420 support zone against the US Dollar. The price gained pace for a move above the $0.47 and $0.50 resistance levels.
The price even broke the $0.520 resistance zone and the 50-day simple moving average (blue). However, the bears were active near the key $0.595 and $0.600 resistance levels. A high was formed near $0.594 and ADA started a fresh decline similar to bitcoin and ethereum.
Cardano’s daily price chart | Source: ADAUSD on TradingView.com
The price declined below the $0.550 and $0.530 support levels. There was also a break below a major bullish trend line with support near $0.532 on the daily chart.
It opened the doors for a drop below the $0.500 support and the 50-day simple moving average (blue). The price even declined below the 76.4% Fib retracement level of the last key increase from the $0.4025 swing low to $0.5945 high.
It is now approaching the $0.420 support zone. The main support is near the $0.400 zone. A downside break below $0.400 support zone and the last swing low might send the price towards the $0.355 level.
A close below the $0.355 support could trigger another sharp decline. In the stated case, the price might towards the $0.280 support or 1.618 Fib extension level of the last key increase from the $0.4025 swing low to $0.5945 high.
On the upside, the price is facing a major resistance near the $0.450 level. The next key resistance might be near the $0.500 level and the 50-day simple moving average (blue). A successful close above the $0.500 resistance could start a decent increase towards $0.550. Any more gains might open the doors for a move towards the $0.60 resistance zone.
Overall, ADA seems to be approaching a major support at $0.420 and $0.400. If the bulls protect losses, the price might recover towards the $0.50 level or even $0.55. Conversely, there could be a downward move towards the $0.355 support.
