Sell the news? Cardano price risks 20% drop despite Vasil hard fork euphoria
Cardano (ADA) has dipped this July 21 as the market favors mounting selling pressure around its most reliable resistance levels in 2022 over a major upcoming hard fork.
ADA's price fell 5% intraday to $0.476. The downside move came as a part of a broader retreat that started a day after it briefly climbed above its 50-day exponential moving average (50-day EMA; the red wave in the chart below) near $0.50.
The 50-day EMA has been serving as ADA's curvy resistance level since October 2021.
Additionally, the upper trendline resistance of a broader descending channel pattern strengthened the selling sentiment around the ADA's 50-day EMA wave. Earlier in June, the same resistance confluence had triggered a 35% price drop toward the channel's lower trendline.
Therefore, ADA's renewed correction move risks leading the price toward $0.384 by July or early August, down about 20% from July 21's price.
However, a separate analysis sees ADA falling to deeper levels than $0.384.
Penned by TradingShot, the bearish ADA forecast draws comparisons between the ongoing correction and the one witnessed during the 2018 market crash, as shown below.
In detail, the 2018 chart above shows ADA undergoing multiple bearish rejections near its 50-day EMA (the orange wave) while trending downward in a descending channel pattern. The token's downtrend became exhausted after correcting by nearly 93% from its local high.
"Based on 1D RSI terms, we also seem to be on the third (3) and final leg below the collapse," TradingShot wrote, adding:
The latest ADA price correction appears in the days leading up to Cardano's hard fork.
Dubbed "Vasil," the hard fork was supposed to go live in June but was delayed until the last week of July over several outstanding
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