Will Cardano reach $1 after this trendline breakout?

With a potential double bottom pattern emerging, Cardano is gearing up for a bull run to challenge the upper trendline. Will this rally result in a breakout to $1?

While maintaining a downtrend on the daily chart, Cardano has taken a major beating in the past few months. The ADA token has lost 54% since April and is currently trading at $0.37, having retreated from its yearly high of $0.81 and falling back after facing the psychological barrier of $1.

The bearish trend of lower highs has led to the formation of a resistance trendline. Apart from the $0.34 support level, a descending triangle is visible, trapping Cardano.

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Cardano’s new bull run within the triangle

Cardano is showing a negative loop from the upper trendline on the daily chart and is finding support at the baseline at $0.34. After falling 13% this week, $ADA has gained 1.65% today and is currently trading at $0.370.

Cardano has a market cap of $13.34 billion, making it the tenth largest cryptocurrency. However, according to Coinglass data, nearly $2.5 million in bullish positions were closed between Thursday and Friday.

The rejection of lower prices on the intraday candle hints at a bullish recovery into the weekend. Moreover, this support level has historically provided a cushion for rebounds.

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The bullish divergence in the daily RSI lines strengthens the possibility of a bullish cycle. However, the bearish trend in the MACD and signal lines continues, with the negative histogram rising.

Will Cardano hit $1 by Q3 2024?

With a bullish divergence in play, Cardano’s recovery rally could accelerate next week. Therefore, chances of a rebound on a breakout of the upper trendline are increasing.

Using the Fibonacci retracement tool for corrections, the 50% Fibonacci level at $0.56 is a potential breakout target. Further ahead, the bullish reversal could complete a rounding bottom reversal with the neckline at the $0.0775 high.

Therefore, a bull run for Cardano looks possible as the market recovers, but the upside may not reach $1 during this quarter. Based on the same Fibonacci retracement, the 1.618 Fibonacci level at $1.041 is a potential target this year.

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