ADA rose 8.27% on Wednesday, to end the day at $0.419. Regulatory risk easing, favorable talk from US lawmakers, as well as US economic indicators, led to a working session. Technical indicators are bullish, putting $0.450 into play.
ADA rose 8.27% on Wednesday. Following a 7.80% gain on Tuesday, ADA ended the day at $0.419. ADA reached $0.420 for the first time since November 6.
A mixed start to the day saw ADA fall to an early morning low of $0.382. Pulling away from the first major support level (S1) at $0.364, ADA rallied to a last hour high of $0.420. ADA broke above the first major resistance level (R1) at $0.402 and the second major resistance level (R2) at $0.416, to end the day at $0.419.
Input Output HK Silence Leaves the ADA in the Hands of US Lawmakers
There were no updates from Input Output (HK) (IOHK) on Wednesday to provide guidance. The lack of IOHK updates after Tuesday’s Valentine update left ADA in the hands of the broader crypto market.
The SEC, on the other hand, proposed amendments to its custody rules to incorporate cryptocurrencies on Wednesday. In addition to the custody rules, the changes would also include amendments related to reporting, bookkeeping, as well as investment adviser registration obligations.
Activity on Capitol Hill also drew attention, with lawmakers reintroducing a bill to make it easier to invest in cryptocurrency in retirement accounts. Former House Speaker Nancy Pelosi tweeted that “Sen. Tuberfille (R) plans to reintroduce the “Financial Freedoms Law”. She further added that “their goal is to prevent the Department of Labor from restricting people from investing their 401ks in crypto. All Americans should have the right to invest their retirement money as they see fit.”
The change in tone followed scrutiny of the SEC by US lawmakers on Tuesday. The Senate Banking Committee held a hearing, “Crypto Crash: Why Financial System Safeguards Are Needed for Digital Assets.” Questions about Gary Gensler and SEC regulation through enforcement, and the SEC’s lack of guidance for crypto companies, highlighted the failures of Gensler and the SEC.
It remains to be seen whether the SEC will seek to introduce regulations, or return to regulation by application. However, the increased scrutiny of US lawmakers on the SEC’s actions is positive for the crypto market.
ADA Price Action – Technical Indicators
ADA needs to avoid a drop through the $0.407 pivot to target the first major resistance level (R1) at $0.432. A move through the morning high of $0.421 would support a bullish session. However, updates to the Cardano network and the broader crypto market should provide support.
ADA broke above the 50 day EMA, currently at $0.380. After the bullish crossover on Wednesday, the 50 day EMA turned away from the 100 day EMA, and the 100 day EMA broke out from the 200 day EMA, providing bullish signals.
A hold above S1 ($0.394) and the 50-day EMA ($0.380) would support a break of R1 ($0.432) to the target of R2 ($0.445) and $0.450. However, a drop-through S1 ($0.394) and the 50-day ($0.380) and 100-day EMAs ($0.378) would give the bears a run to S2 ($0.369) and the 200-day EMA ($0.366). A drop through the 50 day EMA would send a bearish signal.
By Audy Castaneda
