ADA Price Prediction: Bears to Target Sub-$0.390 on Fed Fear

Key Insights:

• ADA fell by 1.48% on Sunday, ending the day at $0.400.
• Input Output HK (IOHK) silence left ADA in the hands of a bearish crypto market session plagued by Fed Fear and regulatory risk jitters.
• Despite the bearish session, the technical indicators remained bullish, leaving $0.450 in play.

ADA fell by 1.48% on Sunday. Reversing a 0.74% gain from Saturday, ADA ended the week up 9.89% to $0.400. Despite the bearish session, ADA avoided sub-$0.390 for the second consecutive session.

After a range-bound morning, ADA rose to a late-afternoon high of $0.412 before hitting reverse. Coming up short of the First Major Resistance Level (R1) at $0.417, ADA slid to a late low of $0.397. However, steering clear of the First Major Support Level (S1) at $0.396, ADA revisited the $0.403 handle before easing back.

IOHK Silence Leaves Fed Fear and Regulatory Risk in Focus

It was a quiet Sunday session, with no Input Output HK (IOHK) network updates to influence investor sentiment. The lack of network news left ADA in the hands of the broader crypto market.

While US lawmaker scrutiny delivered support last week, regulatory risk and Fed Fear remained crypto market headwinds on Sunday. Following the news of the CFTC and DoJ probe into Binance US, the increase in crypto market scrutiny will likely continue to test buyer appetite.

Until a regulatory framework is in place that protects investors and supports innovation, regulation by enforcement will be an issue. However, this could push US lawmakers to pass bipartisan bills that allow the digital asset space to grow with the appropriate regulatory oversight.

This week, Fed Fear will likely linger, with the Fed minutes on Wednesday and inflation and personal income and spending numbers on Friday likely to test the bulls. The threat of a more aggressive Fed interest rate trajectory that could deliver a US economic recession remains price negative.

Input Output HK Weekly Development Report

On Friday, Input Output HK (IOHK) released the Weekly Development Report.

According to the February 17 report,

• 116 projects launched on the Cardano network, unchanged from February 10 and February 3.
• Projects building on the Cardano network totaled 1,204, up by two from the previous report.
• Plutus scripts totaled 5,798, of which 719 were Plutus V2 scripts. As of February 10, Plutus scripts stood at 5,746.

Before the Vasil hard fork, the number of projects launched on Cardano had stood at 98, with 1,100 projects building on the Cardano network.

Other stats included 61.4 million transactions (Previous Report: 60.9m), 7.79 million native tokens (PR: 7.72 million), and 69,778 token policies (PR: 69,498).

Key highlights from the report included,

• Valentine (SECP) upgrade live on mainnet.
• Release of new Mithril distribution.
• Lace Desktop and Marlow Runtime are under ongoing development.

While the increase in the number of projects launched on the Cardano network disappointed, the Valentine upgrade should support a continued upward trend.

The Day Ahead

Investors should continue to track Input Output HK (IOHK) network updates. Increased developer activity and new project launches on the Cardano network would deliver price support.

However, a lack of updates would leave the broader crypto market to provide direction. Fed Fear and regulatory risk remain crypto headwinds. With the US markets closed today, there are no US economic indicators to influence the afternoon session. However, SEC and US lawmaker chatter would move the dial.

ADA Price Action

This morning, ADA was up 1.00% to $0.404. A mixed start to the day saw ADA fall to an early low of $0.390 before rising to a high of $0.404. ADA briefly fell through the First Major Support Level (S1) at $0.394.

Technical Indicators

ADA needs to avoid a fall through the $0.403 pivot to target the First Major Resistance Level (R1) at $0.409 and the Sunday high of $0.412. A return to $0.410 would support a bullish session. However, Cardano network updates and the broader crypto market would need to provide support.

In the event of a breakout, ADA would likely test the Second Major Resistance Level (R2) at $0.418. The Third Major Resistance Level (R3) sits at $0.433.

A fall through the pivot ($0.403) would bring the First Major Support Level (S1) at $0.394 back into play. Barring an extended broad-based crypto sell-off, ADA should avoid sub-$0.390 and the Second Major Support Level (S2) at $0.388. The Third Major Support Level (S3) sits at $0.373.

This morning, the EMAs and the 4-hourly candlestick chart (below) sent bullish signals.

ADA sat above the 50-day EMA, currently at $0.394. Following the Wednesday bullish cross, the 50-day EMA pulled further away from the 100-day EMA, with the 100-day EMA widening from the 200-day EMA, delivering bullish signals.

A hold above S1 ($0.394) and the 50-day EMA ($0.394) would support a breakout from R1 ($0.409) to target R2 ($0.418). However, a fall through S1 ($0.394) and the 50-day ($0.394) would bring S2 ($0.0.388) and the 100-day EMA ($0.387) into play. A fall through the 50-day EMA would send a bearish signal.