In a video uploaded on Dec. 1st, 2023, the analyst behind the popular LuckSide Crypto channel shared his thoughts on the current state of the Cardano cryptocurrency. While maintaining an overall bullish outlook, he expressed some reservations about its near-term price action.
I do have to say that right here, when it comes to ADA, I am holding my breath just a little bit, just a little bit.
The analyst pointed out that while the crypto market as a whole has entered a “new era of bullishness” and remains in a bullish trend, Cardano (ADA) appears to be consolidating within a “very, very big bullish pennant” pattern that has been forming since Nov. 5th.
According to the analyst, ADA is “nestling into this nice little cozy corner” as part of this pennant formation. He showed a chart indicating that ADA recently retested its 20-day moving average support level, bounced upwards, and continues trading above a key bullish trendline.
However, with the pennant stretching on for nearly a month now, the analyst believes ADA may be close to making a definitive move either upwards or downwards to break out of this range-bound action.
The question is, are we going to break to the upside from here? Are we going to possibly face some retracement? Well, by the time this comes out, we’ll probably have a little sense of direction.
The LuckSide Crypto analyst pointed to a broader flattening of capital flows into the crypto space over the past few weeks, with the total market capitalization hovering within a tight range around $1.4 trillion. In his assessment, this suggests digital asset prices across the board have stagnated and entered sideways trading ranges, increasing the likelihood of rotating capital chasing coins with individual momentum spikes.
It leads me to believe that we’re back into this period again, at least a short-term period of time, where capital is going to matriculate, go in a circle around the space. And now it’s just a question of where ADA is at in that circle, right? That’s why I’m holding my breath.
In other words, it remains uncertain whether ADA will be the next token to benefit from another influx of capital and breakout higher, or if it will correct downwards as money rotates elsewhere. For now, the analyst is waiting to see if positive news and sentiment, coupled with rising Bitcoin (BTC) prices, can provide enough momentum to propel ADA out of its current consolidation pattern to the upside.
While entertaining the possibility of a pullback, the crypto expert maintained confidence that any near-term ADA retracements would likely be modest given current market conditions. He does not anticipate a return to the much lower prices from over a month ago, barring an unexpected “black swan” event.
We just have to see if we do, in fact, get the right factors to continue making these steps forward. So just be aware, there’s these possibilities. I’m still on the bullish side of things. I think we’re still moving up and I’m not waiting around for possible corrections.