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ADA Price Prediction: Bulls Eye $0.375 on US Debt Ceiling News

By:
Bob Mason
Published: May 27, 2023, 03:13 GMT+00:00

ADA was in the red this morning, with the IOHK weekly update revealing no new projects on the network. US debt ceiling news remains the focal point.

ADA Tech Analysis - FX Empire

In this article:

Key Insights:

  • ADA joined the broader market in positive territory on Friday, rising by 1.40% to end the day at $0.363.
  • US debt ceiling news provided support, with IOHK updates showing a modest increase in projects building on the network.
  • The technical indicators remained bearish, bringing sub-$0.350 into view.

ADA rose by 1.40% on Friday. Partially reversing a 1.65% loss from Thursday, ADA ended the day at $0.363. Despite the bullish session, ADA fell short of the $0.370 handle for the second consecutive session.

A bearish start to the day saw ADA fall to an early morning low of $0.354 before making a move. Finding support at the First Major Support Level (S1) at $0.354, ADA rose to an early evening high of $0.367. ADA briefly broke through the First Major Resistance Level (R1) at $0.364 before easing back to end the day at $0.363.

US Debt News and IOHK Updates Delivered Support

Input Output HK (IOHK) released the Weekly Development Report on Friday. An upswing in projects was modest for another week, however.

According to the May 26 report,

  • 127 projects launched on the Cardano network, unchanged from May 19.
  • Projects building on the Cardano network totaled 1,244, rising by two from the previous report.
  • Plutus V2 scripts totaled 2,543. As of May 19, Plutus V2 scripts stood at 2,501.

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 67.2 million transactions (Previous Report: 66.7m), 8.33 million native tokens (PR: 8.28 million), and 74,255 token policies (PR: 73,880).

While the IOHK weekly updates drew interest, reports of progress toward raising the US debt ceiling supported the bullish session. The optimism limited the rising probability of a June Fed interest rate hike following a pickup in inflationary pressure.

The Day Ahead

Investors should monitor Input Output HK (IOHK) network updates. However, a lack of updates should leave ADA in the hands of the broader crypto market and US debt ceiling-related news. Progress toward raising the debt ceiling should provide further gains.

However, SEC v Ripple-related news and Binance and Coinbase (COIN) chatter will also move the dial.

ADA Price Action

This morning, ADA was flat at $0.363. A range-bound start to the weekend saw ADA fall to an early low of $0.362 before rising to a high of $0.364.

ADA sees red.
ADAUSD 270523 Daily Chart

ADA Technical Indicators

Resistance & Support Levels

R1 – $ 0.3687 S1 – $ 0.3557
R2 – $ 0.3743 S2 – $ 0.3483
R3 – $ 0.3873 S3 – $ 0.3353

ADA has to avoid the $0.361 pivot to target the First Major Resistance Level (R1) at $0.369. A move through the Friday high of $0.367 would support a bullish session. However, IOHK updates and US debt ceiling-related news would need to deliver support.

In the case of a breakout, ADA would likely test the Second Major Resistance Level (R2) at $0.374. The Third Major Resistance Level (R3) sits at $0.387.

A fall through the pivot would bring the First Major Support Level (S1) at $0.356 into play. However, barring a risk-off fueled sell-off, ADA should avoid sub-$0.350 and the Second Major Support Level (S2) at $0.348. The Third Major Support Level (S3) sits at $0.335.

ADA resistance levels in pay above the pivot.
ADAUSD 270523 Hourly Chart

Today, the EMAs and the 4-hourly candlestick chart (below) sent bearish signals.

ADA sat below the 50-day EMA, currently at $0.364. The 50-day EMA eased back from the 100-day EMA, with the 100-day EMA pulling back from the 200-day EMA, delivering bearish signals.

A move through the 50-day EMA ($0.364) would support a breakout from the 100-day EMA ($0.368) and R1 ($0.369) to give the bulls a run at R2 ($0.374). However, failure to move through the 50-day EMA ($0.364) would leave S1 ($0.356) in view. A move through the 50-day EMA would send a bullish signal.

EMAs are bearish.
ADAUSD 270523 4-Hourly Chart

About the Author

Bob Masonauthor

With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.

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