Cardano’s price is up 22% over the past week breaking through the resistance of the symmetrical triangle pattern. This double-digit growth pushed the price of ADA above $1 USD.
Growing demand for this altcoin could help ADA continue to see price gains in the short term. Here’s why.
Demand for Cardano is high
Due to broad market consolidation, ADA’s price traded in a symmetrical triangle pattern from December 3 to January 15.
A symmetrical triangle pattern forms when the price of an asset merges with a series of lower highs and higher lows, creating a triangle shape. It often signals a period of uncertainty in the market and often precedes a breakout in the direction of the previous trend.
However, as demand increased sharply over the past week, ADA’s price successfully broke out above the upper line of this pattern during Thursday’s trading session. This breakout signals a positive change in sentiment. , showing that buying force has begun to exceed selling force.
The coin’s Relative Strength Index (RSI) confirms the increase in demand. At the time of writing, the index is trending up to 62.09.
The RSI measures oversold and overbought market conditions of an asset. It ranges from 0 to 100, with values above 70 indicating the asset is overbought and may need a correction. Conversely, values below 30 indicate the asset is oversold and is likely to recover.
At 62.09, ADA’s RSI shows strong bullish momentum, suggesting that the asset is trending up but is not yet overbought.
Furthermore, figures from the Elder-Ray Index also support this positive view. At the present time, this index returns a positive value of 0.18, indicating strong buying pressure and confirming a positive trend in the market.
ADA Price Prediction: $1 Level Is Key
Currently, ADA trades at $1.12, just above the $1.03 resistance formed by the upper line of the symmetrical triangle pattern. With growing demand for this altcoin, a successful retest of this breakout line would flip the $1.03 price level into a support base, pushing ADA to a 30-day high of 1.34 USD.
However, if the retest fails, the price of ADA will return within the symmetrical triangle pattern at $0.94.