Cardano is still in a downtrend, testing support at the bottom of the descending channel visible on the 4-hour chart. Price could be due for a correction to the channel resistance before resuming the drop.
Applying the Fibonacci retracement tool shows the next potential ceilings. The 38.2% Fib is at the middle of the channel around 0.1800 while the 50% level is at 0.1915. The 61.8% level is in line with the channel top and is near the 0.2000 major psychological level.
In addition, this also coincides with the 100 SMA dynamic resistance. This short-term moving average is below the longer-term 200 SMA to indicate that the path of least resistance is to the downside. This means that the selloff is more likely to resume than to reverse.
However, the gap between the moving averages is narrowing to suggest that bearish momentum is slowing. This could also mean that an upward crossover is brewing and it would draw buyers back in.
RSI is moving north so Cardano might follow suit. Stochastic is also pulling up from oversold conditions to signal that buyers have the upper hand while sellers take a break.
Cryptocurrencies have been in a weak spot recently while US regulators carry on with their probe into whether or not prices of digital assets like bitcoin have been manipulated. If evidence strongly suggests so, trust in the industry could be further eroded.
For now, Cardano and its peers are taking advantage of the dip in the dollar after the FOMC decision. Even though the central bank hiked rates and indicated room for two more hikes this year, the US currency was unable to hold on to its post-announcement gains.
Persistent trade war fears are weighing on the dollar as the Trump administration gears up to impose higher tariffs on Chinese products before this week ends.
Source : Ethereum World