ADA coin price is under tremendous buying pressure and hints at double bottom breakout. Will the increased trend momentum reach $2?

Founded by Charles Hoskinson, one of the co-founders of Ethereum, CEO of IOHK, Cardano is one of the largest blockchains to successfully use a proof-of-stake consensus mechanism. The new consensus consumes less power than the proof-of-work algorithm on which Bitcoin is based. 

On September 12, Cardano released its highly anticipated Alonzo update. After the update, the network now supports a wide array of crypto applications, including non-fungible tokens (NFTs) and smart contracts.

Let us look at what the Cardano technical analysis reveals:
<h2>Past Performance of ADA</h2>
The ADA coin price action shows a V-shaped recovery in the <a href="https://www.cryptoknowmics.com/news/solana-sol-and-cardano-ada-technical-analysis-will-bulls-succeed/">daily chart</a> with a 30% price jump following the downfall to $1.125. The coin price shows a rise of almost 10% in the past 24 hours, with a 130% rise in intraday trading volume. This indicates a boom in the underlying buying pressure. The price approaches the crucial resistance level of $1.5 that may soon generate a breakout entry opportunity.

<img src="https://s3.tradingview.com/snapshots/d/dVWpEK7S.png" alt="TradingView Chart" />

<a href="https://www.tradingview.com/x/dVWpEK7S/">ADA/USD Daily Chart</a>
<h2>ADA Technical Analysis</h2>
The V-shaped in the ADA coin price completes a double bottom pattern in the daily chart. The neckline of the patterns coincides with the resistance level at $1.5. Therefore, the breakout of the pattern will give an excellent buying spot. 

Crucial EMAs (50, 100, and 200) trend lower in a bearish alignment in the daily chart. The price breaks above the 50-day EMA and continues to reach the 200-day EMA. 

The RSI indicator at 59% shows a sharp increase in the slope resulting in the central line (50%) breakout in the daily chart. Therefore, the indicator reflects a boom in the underlying bullish momentum.

The MACD indicator shows a sudden rise in the MACD line driving the line further away from the signal line after the bullish crossover. Moreover, the solid growth in bullish histograms suggests increased buying pressure.

Therefore, the rising buying pressure is evident by the technical indicators, increasing the chances of a bullish breakout of $1.5. 
<h2>Upcoming Trend</h2>
The double bottom pattern made by the ADA coin price action can shortly give a bullish breakout of the neckline at $1.5. Therefore, traders can expect the breakout to reach the $2 mark by the end of January. 

The price action suggests upcoming resistance levels at $2 and $2.30 following the level at $1.5. And, in case of a bearish reversal, the price can find support at $1.125  and $1.

At press time, the sentiment chart gives a strong "BUY" signal for the ADA token.
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ADA Technical Analysis: Double Bottom Breakout Can Reach $2, Is It the Best Buy of 2022?

ADA coin price is under tremendous buying pressure and hints at double bottom breakout. Will the increased trend momentum reach $2?

Vikram is a technical analyst with several years of experience in the crypto market &amp; Indian Equity and F&amp;O Segment. He loves to learn anything and everything related to finance. He possesses strong technical and analytical skills, which he leverages to acquaint our audience with upcoming price trends for different coins.

ADA Technical Analysis: Double Bottom Breakout Can Reach $2, Is It the Best Buy of 2022?

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