Cardano Potential Triple Bottom Pattern at $0.40
Cardano's (ADA) daily chart highlights the prospects of a potential triple bottom pattern at the $0.40 psychological number. Additionally, a confluence of technical factors supports the bullish case scenario like the RSI hidden divergence and the 3-months descending triangle.
ADA Triple Bottom
The daily technical picture reveals that ADA has carved out a double bottom at the $0.40 level and is now eyeing the third tough of the support level to complete a triple bottom bullish reversal pattern.
Usually, there is symmetry between the 3 consecutive valleys, which means that we can expect the next bottom to materialize 62 days after the second bottom.
This implies that the final bottom can emerge on September 13. While we can't expect to develop a bottom on the exact date, this is a rough approximation.
Descending Triangle
At the same time, ADA is trading inside a descending triangle as each successive bounce from the $0.40 got smaller and smaller. As the price compresses inside the descending channel, we can expect the price ranges to get smaller and smaller.
This ultimately will lead to a breakout as prices move from small price ranges to large price ranges.
RSI Hidden Divergence
The hidden bullish divergence develops when the price makes a higher low while at the same time the Relative Strength Index (RSI) oscillator makes a lower low. This is often perceived as a bullish signal.
When we have multiple confluence technical factors lining up, the bullish case scenario becomes much more relevant, and there is a higher chance that the price will work in favor of these signals.
Cardano coming hard fork update
The Cardano team has announced a major update to the Cardano blockchain that will include a potential triple bottom pattern. The update is set to go live on October 25th and it will introduce new features and improvements.
One of the features is a new protocol layer that is designed to improve scalability. The team says that the new protocol layer will make ADA more resistant to attacks and improve the overall performance of the network.
