Cardano (ADA) has seen a 4% increase on Monday, attempting to reach $0.65 and displaying signs of a revived bullish trend. The technical indicators are starting to align favorably for buyers, with the BBTrend turning positive after several days and the DMI indicating a strengthening upward pressure.
ADA is also close to forming a golden cross on its EMA lines, which could provide further support for a breakthrough if resistance levels are overcome. As momentum increases and crucial levels approach, Cardano is entering a critical phase that may determine its short-term direction.
Early indications of recovery are seen in Cardano as BBTrend shifts into positive territory at 0.11 after a prolonged period in the negative zone. This subtle change might signal stabilization of momentum following recent weakness.
BBTrend is a technical indicator that evaluates trend strength and direction based on Bollinger Bands' width. Positive BBTrend values, along with expanding bands, often suggest increased volatility favoring a potential bullish trend emergence. Conversely, extended negative readings indicate declining momentum and lack of directional strength.
Although a BBTrend of 0.11 is relatively low and does not strongly signal an uptrend yet, the shift to a positive value indicates a potential turning point, hinting at diminishing selling pressure and a possible price recovery if buying activity rises. This early positive BBTrend movement typically precedes a broader trend shift.
Traders are likely to monitor closely if this positive change is sustained in upcoming sessions, as continued gains in BBTrend could indicate the start of a more definite upward movement for ADA.
Meanwhile, Cardano's Directional Movement Index (DMI) shows a significant momentum shift, with the Average Directional Index (ADX) increasing to 17.79 from 13.77 the day before. The ADX measures trend strength on a scale of 0 to 100, with values below 20 indicating a weak trend and readings above 25 confirming a strengthening trend.
Despite ADA's ADX still being under the 20 threshold, its gradual rise suggests developing momentum and a potential stronger directional shift ahead. The +DI has surged from 16.30 to 26.38, indicating heightened buying pressure. The widening gap between the +DI and -DI implies a clear shift in favor of buyers, with control being regained after a brief selling phase.
If the ADX continues to climb in conjunction with a dominant +DI, it could confirm a strengthening uptrend for Cardano.
Cardano's price is nearing a potentially bullish technical event, as its EMA lines hint at a potential golden cross formation soon. A golden cross occurs when the short-term moving average surpasses the long-term moving average, often indicating the beginning of a stronger uptrend.
If ADA confirms this crossover and breaks above the $0.668 resistance level, the next targets are at $0.709 and $0.77, levels not seen since late March. However, failure to maintain this upward momentum and if the price weakens, downside risks persist.
A drop towards the $0.594 support would signal weakness, with potential further losses if it falls below that level, targeting the $0.511 support region. The price action around the $0.668 resistance will likely dictate Cardano's near-term direction.