Cardano (ADA) Showing Bullish Signs

The Cardano chart (ADA/BTC) looks like it's got potential. Let's start with the bigger picture. Zooming out, it looks like we're reaching a decision point where, like bitcoin, we may see a major move up or down.

A good case can be made for a bullish breakout. Looking at the 4 hour chart, we can see what may be a cup and handle pattern. If this is accurate, the target for this would be 0.0006456 satoshi.

Zooming into the 4 hour chart, it seems to be beautifully following a bullish elliot trend. With the overall market in chaos, it's nice to see a clean looking chart. Cardano has completed 5 waves up, followed by an ABC correction. It now seems to have started another 5 waves up, with wave 1 looking complete. We're now looking for the bottom of wave 2.

Zooming into the 1 hour chart, I'd expect wave 2 to complete possibly around the 0.382 fib level. It's currently bouncing off the 0.236 fib. If it does begin wave 3 at this point, that'd be a very bullish indication.

Looking at the 1 hour RSI, we can see an ascending support line has formed.

The 4 hour MACD looks like it's just crossing over to the negative side. This may indicate the coming drop needed to complete wave 2.

Zooming out to the 1 day MACD, we can see it's just crossed over to the bullish side. This may indicate the coming uptrend that will begin in the form of wave 3, once wave 2 completes.

Looking at the 4 hour RSI and 4 hour MACD, we find bullish divergence. This lends credibility to the overall bullish count.

Looking at the 4 hour chart, the 8 day EMA was acting as support, but was just broken. This also may indicate a lower wave 2 is coming. The overall order of the 8 day EMA on top, 21 in the middle and 55 on the bottom is very bullish. If we see the 8 day EMA start to cross below the 21 day, I'll need to re-evaluate my count.

If you're unfamiliar with how to use EMA's, reference my post on the topic here: https://steemit.com/cryptocurrency/@workin2005/simple-effective-strategy-to-buying-and-selling-market-trends

Cardano, like most Altcoins, is tied to bitcoin. This means, even though this is a fairly bullish looking chart, if bitcoin drops, Cardano will most likely drop with it. Due to the uncertainty with bitcoin, I'm hesitant to take out a position. However, if it bounces hard off the 0.382 fib level, I may take a small position with a tight stop-loss. Let's see how this plays out.

BIAS:
Short Term: Neutral
Longterm: Bullish

I hope this has been helpful. I’d be happy to answer any questions in the comment section below. Thanks for stopping by.

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Disclaimer: I am NOT a financial advisor and this is NOT financial advice. Please always do your own research and invest responsibly. Technical analysis is simply a guide. It doesn’t predict the future. Anyone that claims they know exactly what’s going to happen is foolish, lying or both. Technical Analysis should only be used as a tool to help make better decisions. If you enter a trade, I recommend having a stop loss and sticking to it. You will loose at times. The key is to have more wins than losses. With that in mind, I wish you great success.

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