After hitting a new multi-month high, Cardano (ADA) has retraced alongside the rest of the market. Some analysts suggest that the cryptocurrency is ready to reclaim crucial resistance levels and hit new highs in the coming months.
On Thursday, Cardano experienced an 11% drop after surpassing the $1.00 barrier for the first time since March. ADA’s retracement was fueled by the crypto market’s pullback, which saw massive liquidations throughout the day.
According to CoinGlass data, the crypto market saw over $1.05 billion in liquidations over the last 24 hours, driven by higher-than-expected macroeconomic signals. Notably, the PPI number revealed an annual headline inflation of 3.3%, way higher than the 2.5% forecast.
Additionally, the US Treasury Secretary Scott Bessent revealed that the US government will not be purchasing additional Bitcoin for its Strategic Bitcoin Reserve (SBR), established by President Trump in March 2025. Instead, the US will stop selling its BTC holdings and continue to build up the reserve’s stash through confiscated assets.
As a result, Bitcoin, which hit a new all-time high (ATH) of $124,128 on Wednesday night, retraced to the $117,000-$118,000 support zone, while the rest of the market turned red.
Nonetheless, Cardano has gone against the current, becoming the only cryptocurrency in the top 50 list to remain in green despite the broader market pullback, with a 3.5% increase in the daily timeframe.
In the last 24 hours, ADA has broken out of its local range, hitting a five-month high of $1.02 on Thursday morning. Amid the market drop, ADA held above its breakout level, hovering between the $0.89-$0.91 range over the past few hours, and it’s attempting to break out of its current levels.
Analyst Ali Martinez noted that ADA has been trading within a descending channel since the Q4 2024 rally, which saw the cryptocurrency hit its multi-year high of $1.32 in December.
During this period, Cardano has attempted to break out of the descending resistance twice, finally passing this barrier after surging above the $0.84 mark. To the analyst, a confirmed breakout from this level targets a 70% run to $1.50.
Previously, Martinez suggested that ADA is showing the same price structure as the last cycle, but it’s more gradual. Other analysts have also noted that the altcoin appears to be repeating its 2020-2021 playbook.
Crypto Yhodda highlighted that after hitting its 2018 high, Cardano saw an ABC corrective wave before consolidating within an ascending broadening wedge formation for two years.
The cryptocurrency consolidated near the range-high after rejection from the pattern’s resistance in 2020, and before breaking out to its 2021 ATH of $3.09.
This cycle, the altcoin has repeated the same movements, accumulating within the same pattern since 2022. Since being rejected from the ascending resistance in late 2024, ADA has been trading between the mid and high zones of this pattern.
To the analyst, Cardano is ready to climb again to the formation’s resistance, around the $1.80 area, and break out to new highs.
As of this writing, ADA is trading at $0.90, a 20% increase in the weekly timeframe.
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Author: coinmaker
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