A Recap:

In Aug 2019 I posted an article where I revealed that the priceline of Cardano was forming a shark pattern.

RSI had still some cushion to move in oversold zone and moving average convergence divergence (MACD) was still strong bearish, therefore there was more possibility that the price action will definitely complete the final leg of Shark which was being formed at that time below was the article:



https://www.tradingview.com/chart/ADAUSDT/QZuiwmFt-ADAUSD-a-formation-of-shark-Upto-225-possibility/

As per Fibonacci sequence the targets were as below:

Buy between: $0.04315 to $0.02760

Sell between: $0.05788 to $0.08991

As per above targets this trade had potential to produce upto 255% gains.

Finally we witnessed that since Dec 2019 to Jan 2020 the priceline of ADA moved up and sofar it has produced up to 138% profit as below:



Price Correction Started After One And A Half Month:

If we examine the price action of Cardano on 2 day chart then it will be realized that since 1st Jan to 14 Feb 2020 there the ADA was moving up in a very bullish manner that there is not even a single red candle stick appeared during this period even it has broken out all simple moving averages from 25 to 200 during this period every professional trader was expecting a price correction move which the Cardano was not making even with every day the buying volume was being more increased that was a clear indication that bull has completely taken over the bears and they are in charge now.



The Moving Averages:

Now if we move one step back from 2 day to daily chart then here the simple moving averages with time period of 25, 50, 100 and 200 have almost formed an alligator’s bullish opened mouth there is only one move left and that is the golden cross between 100 and 200 SMAs once this bull cross will be formed we can witness a new and more powerful bull rally like once it was happned in April 2019 when Cardano gained more than 80% value from $0.5910 to $0.10687.



Similarity Of Moves:

Now if we switch back to 2 day chart again then in previous move we can see some resemblance with current move when the price action moved up without any price correction from 4TH Mar to 3rd April 2019 and then ADA dropped up to 0.618 (61.8%) Fibonacci level which is considered as ideal drop or retracement among professional traders and Cardano also had a 50 simple moving average support at this level, and the price action took bullish divergence from this level achieved higher than previous high.

This time the price action is seems to be taking the same move as we can observe that it has moved up from Jan to Feb 2020 without any correction and now it is being retraced.

Sofar it has achieved 1st level of ideal retracement upto 0.382 (38.2%) Fibonacci but this time the ADA is in more stronger position than previous move coz from Mar to April 2019 the price action did not have the 200 SMA support even at that time the 200 SMA moving down from a long distance above the price action but this time we have 200 simple moving average support between 0.382 to 0.50 (38.2% to 50%) Fibonacci level therefore this time there are more chances that the priceline will start upward move after taking bounce from 200 SMA and that moving average this time lies at $0.5492.



So most of the professional traders might set this 200 simple moving average as their stop loss and most of the other traders may place their buying positions at this level by setting the same 200 SMA as their stop loss.

Conclusion:

At this time there are two decision making levels one is simple moving average 200 and the other one is Fibonacci level of 0.50 (50%) if the price action of Cardano will be successful to retest these levels as support and bounced from here then we may see more powerful bull rally which will lead to achieve a higher than the previous high but if the priceline won’t be successful in retesting these levels as support then we may see the drop up to 0.618 Fibonacci level which is at $0.04753.