ADA joined the broader crypto market in the red on Tuesday, falling 2.72% to end the session at $0.393. Input Output HK (IOHK) updates faded to the background, with US economic indicators and Fed Fear sending riskier assets into negative territory. Technical indicators turned bearish, putting less than $0.380 into play.
ADA fell 2.72% on Tuesday. Reversing a 1.00% gain on Monday, ADA ended the day at $0.393. The bearish session left ADA below $0.400 for the first time in five sessions.
A bullish start to the day saw ADA rise to a mid-morning high of $0.407, before pulling back. Breaking below the first main resistance level (R1) at $0.413, ADA fell to a late low of $0.386. The reversal sent ADA briefly falling through the first major support level (S1) at $0.393, before ending the session at $0.393.
IOHK Silence Leaves Fed Fear to Mute Network Sentiment
It was a busy Tuesday for global financial markets. After the US holidays, US private sector PMIs generated interest. Better-than-expected services sector PMI numbers fueled fears for the Fed. Following the impressive ISM Non-Manufacturing PMI numbers, the Markit survey-based PMI showed a return to growth.
Recent economic indicators have fueled bets on a more aggressive Fed rate path to bring inflation to target. Services PMI supported the more aggressive outlook, with markets betting higher for longer.
The NASDAQ Composite Index fell 2.50%, with the Dow and S&P 500 down 2.06% and 2.005, respectively.
There were no Input Output HK (IOHK) network updates to distract investors, leaving ADA in the hands of the broader crypto market.
ADA saw red despite improving sentiment towards the Cardano network, the upward trend in network projects, and ongoing updates to the network to improve developer experiences. Increased US regulatory scrutiny has contributed to bearish sentiment and a return of ADA to below $0.400.
ADA Action Price – Technical Indicators
This morning, ADA was down 2.54% at $0.383. A bearish start to the day saw ADA slide from an opening price of $0.393 to a low of $0.381. ADA fell through the first major support level (S1) at $0.384.
ADA has to move through S1 and the $0.395 pivot to target the first major resistance level (R1) at $0.405 and Tuesday’s high of $0.407. A return to $0.400 would support a bullish session. However, updates to the Cardano network and the broader crypto market should provide support.
In the event of a breakout, ADA would likely test the second major resistance level (R2) at $0.416 and resistance at $0.420. The third main resistance level (R3) sits at $0.437.
If it doesn’t move through S1 and pivot ($0.395), the second major support level (S2) would leave $0.374 up for grabs. However, barring a broad-based crypto sell-off, ADA should avoid below $0.370 and the third major support level (S3) at $0.353.
Today, the EMAs and the 4-hour candlestick sent bearish signals. ADA broke above the 200-day EMA, currently at $0.377. The 50-day EMA closed above the 100-day EMA, with the 100-day EMA lowering back to the 200-day EMA, providing bearish signals.
A move through the 100-day ($0.390) and 50-day EMAs ($0.395) would support a breakout from R1 ($0.405) to target R2 ($0.416) and $0.420. However, a drop through the 200-day EMA ($0.377) would bring S2 ($0.0.374) into view. A move through the 50-day EMA would send a bullish signal.
By Audy Castaneda
