Cardano Faces Crucial Support Test at $0.50 Amid Bullish and Bearish Signals

Cardano (ADA) is currently approaching a critical support level, which has held firm on two previous occasions, forming a potential triple bottom structure. This pattern is often seen as a bullish reversal indicator. Additionally, ADA is trading within a large falling wedge, a pattern that frequently precedes price breakouts. The asset is currently priced at $0.5243.

If ADA maintains this support level and closes with a bullish weekly candle, it could confirm a triple bottom formation. This pattern suggests a potential change in trend direction, which could lead to a breakout. The next targets for ADA, if the bullish pattern confirms, are $1.0057, $1.2114, and $1.4329.

Despite recent price drops, technical indicators show a possible shift in momentum. The Relative Strength Index (RSI) stands at 58 on the 4-hour chart, suggesting there is room for further upward movement. The Moving Average Convergence Divergence (MACD) line has also crossed above the signal line, indicating increasing buying momentum.

Cardano’s long-term outlook is gaining attention with the odds of a Cardano ETF approval by 2025 now at 79%. This increase in optimism is driven by positive signs from the SEC during meetings with asset managers. As institutional interest grows, on-chain activity remains strong. Data shows a 5.7% rise in daily active addresses, reaching 42,000. With over 71% of ADA staked, investor confidence remains firm. If price holds and momentum continues, ADA could be preparing for a bullish breakout.

However, there is also caution among analysts as Cardano approaches a crucial support zone near $0.50. The bearish momentum is building, and there is a growing concern that the cryptocurrency may retest its April lows. The recent attempts to push higher have lacked the necessary strength, leading to a slide back towards familiar lows. This shift in momentum has made the setup appear fragile, and sentiment is turning cautious as key levels come back into focus.

Cardano is currently trading around $0.55, which is a significant level as it represents both the point of control and the highest volume node within its current trading range. This level is not just a random figure; it is a structural pivot that has historically separated bullish continuation from full breakdown. If this $0.49 level holds, the upside target opens toward $1.19, aligning with prior macro highs and liquidity gaps. However, if ADA slips below this support, especially with volume, it could trigger a fast move down to the $0.30 region, where previous capitulation zones lie.

Adding to the caution, new analysis highlights that ADA remains stuck under a descending trendline. As long as it stays capped there, the price action looks biased for at least one more sweep lower. The chart highlights a possible wave structure pointing towards a low in the $0.510 to $0.505 range, right in the green demand zone. Technically, the area between the 1.236 and 1.38 Fibonacci levels lines up with the previous breakdown target zones. Until a bottom forms, the price structure remains tilted toward lower lows unless bulls can reclaim the trendline with momentum.

Cardano has also dropped to the 8th position in the latest weekly returns snapshot, logging a -9.4% decline. This drop aligns with what’s playing out on the chart: ADA is hovering just below the $0.50 zone. Technical signals remain under pressure, with price continuing to reject descending trendlines and bearish wave structures still active, suggesting momentum is poised towards the downside. Unless buyers step in soon, ADA risks slipping further, not just in price, but also in its place among the majors.

The failure to rally from key support has tilted momentum back to the downside, and the lack of any strong reversal signal means traders are now eyeing a retest of the April lows. If $0.45 breaks, $0.41 isn’t far off, and from a structural standpoint, that’s a level that could trigger a sharper drop if confidence fades further. That said, ADA still has room to defend itself. Bulls need to show up now, or risk losing further support in the process. Until ADA sees a decisive reclaim of the descending trendline and some volume behind it, the trend remains under pressure.

On the other hand, some analysts point to an ascending triangle breakout, with resistance at $0.73. According to the analyst's forecast, ADA could hit $0.94 by August and possibly reclaim $1 by fall if momentum holds. This optimistic outlook contrasts with the current bearish sentiment, highlighting the uncertainty surrounding Cardano's future price movements.