August 20th Technical Analysis: Bitcoin & Cardano
Major cryptocurrencies were trading higher on Friday. Cardano and XRP were among the biggest gainers of the day while Bitcoin also edged higher amid weaker equity markets.
Many see cryptocurrencies as a store of value akin to gold, which results in buying interest whenever there is a fear that interest rates will rise or some economic slowdown will be there. The FOMC minutes released by the US central bank indicated an earlier than expected tapering.
“Markets in the past 24 houhours witnessed a major turnaround. Most of the cryptos that were showing bearish signs earlier, recovered quickly. Bitcoin and Ether, the two most important cryptos that usually influence rest of the market movements, broke above their immediate resistance levels. It will be interesting if the crypto markets end the week on a high note,” said Edul Patel, CEO and co-founder, Mudrex.
After a spurt of rally, Bitcoin has not moved much in the last one week. With a gain of about 4 per cent, most of which have come in the last 24 hours, the most valuable cryptocurrency is trading near $47,000 level.
Meanwhile, the market is waiting for the IPO of Binance, the world’s largest cryptocurrency exchange. If listed successfully, it will get some badly needed legitimacy. Companies that deal in digital money are trying to grow up. Many cryptocurrency firms are restructuring themselves into more traditional entities that have boards of directors and audited financial reports.
“We saw coins like Solana and Cardano do well. We are hopeful that the market will enjoy a strong rally soon,” said Sharan Nair, Chief Business Officer, CoinSwitch Kuber. Solana has been a standout altcoin in the last seven days, rising nearly 70 per cent.
Tech View by ZebPay Trade Desk
Cardano (ADA) positions itself as a POS blockchain platform that allows decentralized apps and smart contracts to be developed with modularity. It is designed to ensure that owners can participate in the operation of the network as a means of governance.
It is one of the biggest networks to have successfully implemented the POS blockchain mechanism. In 2020, the protocol underwent a “Shelley” upgrade to scale its infrastructure furthermore and allow better Decentralized Applications (DApp) integrations. Since then, the growth of ADA has been impressive.
ADA made a ‘Double Bottom’ pattern or a ‘W’ pattern at $1.009. It completed the pattern at $1.50 giving a breakout with good volumes and the asset witnessed a sharp rally surging almost by 141 per cent up to $2.46 making a higher top and higher bottom formation on the daily chart. Currently, the asset is trading near its all-time high and may face some resistance at these levels. We can expect another rally if the prices sustain or close above the all-time high of $2.49.