According to crypto analyst Ali Martinez, Cardano (ADA) is exhibiting a price consolidation pattern that is highly bullish. Drawing parallels to the consolidation phase of 2018-2020, Martinez points out that ADA’s current trend is a mirror image, albeit without the disastrous COVID-19 crash.
“Cardano’s current consolidation trend eerily mirrors the 2018-2020 phase without the COVID-19 crash! If so, ADA could break through the $0.45 resistance around the first week of December. The upswing could send ADA to $0.75 by late December,” Martinez shared in a recent post on X.
The one-week chart for ADA/USD indicates a prolonged consolidation phase spanning 665 days until July 2020, after which ADA experienced a 2,984% rally, peaking at $3.058. A significant aspect of this ascent was the retest of the upper consolidation box line, which took several months from summer 2020 to early 2021. Interestingly, after dipping back into the consolidation box, ADA initiated a second breakout that led to the massive bull run.
Cardano Poised For 650% Rally Till July?
Martinez’s analysis suggests that ADA could be on the brink of its first breakout from its current consolidation range of sub-$0.25 to $0.45, which has lasted for 434 days. He outlines two possible trajectories for ADA’s price in the forthcoming period, using a gray and a blue line in his chart.
The more bullish scenario (gray line) anticipates a breakout above the consolidation zone that could catapult ADA to $0.75 by the end of December, assuming it surpasses the crucial resistance at $0.45. Following the historic pattern, a retest of the breakout mark could occur over several months.
This could potentially set the stage for an explosive rally beginning in early summer 2024, leading ADA to climb approximately 650% from its present value and surge past the $3 mark. However, Martinez does not see this as the zenith of ADA’s potential growth. The gray line suggests a continued upward movement, with ADA possibly reaching $6.50 before the closure of 2024.
The second, more conservative scenario (blue line) posits that the Cardano price consolidation may extend until July 2024, with potential dips below $0.25 if a market crash akin to the COVID-19 downturn occurs. In this case, a breakout towards $0.75 would be expected around July, followed by a retest at $0.45 by the end of 2024, eventually propelling ADA towards the $3 threshold by mid-2025.
Short-Term Price Analysis
On the lower time frames, ADA is currently making strong moves. The price has successfully retested the 0.5 Fibonacci retracement level ($0.341) and soared above the 0.618 Fibonacci retracement level ($0.37). In the first attempt, ADA failed at the 0.786 Fibonacci retracement level ($0.0.411). However, if this resistance is broken, the door to the yearly high at $0.463 is clearly open.
Featured image from iStock, chart from TradingView.com