Cardano price has moved sideways in the past few days and is now stuck at a crucial support level. ADA was trading at $0.3913, down by over 70% from its highest point in December 2024. However, technical analysis suggests that the token may be on the cusp of a strong bullish breakout in the near term.
Cardano Price Technical Analysis Points to a Surge
The weekly timeframe chart shows that the ADA price dropped to a low of $0.3355 in December and has hovered at that level since then. This price was notable as it coincided with the ascending trendline that connects the lowest swings since June 2023.
The trendline is part of the megaphone pattern that has been forming in the past few years. A megaphone is made up of two ascending and diverging trendlines and is a common bullish pattern.
The coin is also at the apex of point D of the Elliot Wave pattern. Therefore, it may be starting the final phase (DE), which is usually a bullish one. If this happens, the next target to watch will be at $1.3256, its highest level in December, which is about 250% above the current level.
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This ADA price forecast has two main caveats. First, it is based on the weekly chart, meaning that it may take months or even years for the coin to get to its target.
Second, its lowest level in December will be a crucial one as moving below it will invalidate the megaphone pattern. Such a move will point to more downside, potentially to the key support at $0.2173, its lowest level in 2023, which is down by 45% below the current level.
ADA Has Potential Catalysts
Cardano token has several potential catalysts that may push it higher this year. First, there are chances that Hydra, its layer-2 scaling solution will see more adoption in the next few years.
Second, the developers will launch Midnight mainnet in the current quarter after the successful launch of the NIGHT token. Midnight aims to become a major player in the privacy industry by using zero-knowledge (zk) technology.
Midnight launches at a time when many cryptocurrency experts are betting on the privacy industry. Indeed, tokens like Monero and Dash have been some of the top gainers this year. However, the main risk is that Ethereum plans to launch its zk upgrade soon.
Third, the developers are working on the Leios upgrade, which will boost its network speed. On top of this, they are implementing the Pentad proposal that aims to bring in tier-1 stablecoins, analytics platforms, and oracle networks. It has already incorporated Pyth, a top oracle network, and Dune, a leading analytics platform.
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