Cardano (ADA) looking for breakout: $0.143 in next wave

22 May, 2019 | Updated: 22 May, 2019
by Lourens Pepler
Price Analysis
Cardano (ADA) looking for breakout: $0.143 in next wave

While Bitcoin struggles to stay above $8000 most of the altcoins has been busy pumping. Some coins are even moving 100% in less than a day. As we wait for BTC to break to new highs, or even break down to the nearest support, we will continue to look to alts for possible moves. Cardano looks to be an interesting choice, what does ADA have in store for us?

Highlights:

- ADA continuing its bull run

- Elliot wave forming, currently in the 5th wave

- Target of $0.143

Cardano has been on a good run in 2019, providing almost more than 150% gains since January. If we start off by looking at the hourly we can see that we are currently in a symmetrical triangle after an impulse, which means we are likely to continue higher. At the moment we are right at the deciding point for this triangle and should soon see the direction is chooses.

Looking to momentum indicators we can see that RSI is finding support above the 50 line, meaning that its leaning to the bullish side and that we should expect a break to the topside.

 

ADA/USD chart provided by Tradingview


The perfect Elliott wave?
Let's take a step back and look at the daily to see where we can possibly move to after the breakout. The first thing we notice is that an Elliott Wave is busy forming and that we are currently in the 5th wave.  The 5th wave in an Elliott is usually the longest, so we should expect a sharp increase to come for ADA. Now to see where this 5th wave will push to, we need to take out our favorite tool, the Fib extension tool.

 

ADA/USD chart provided by Tradingview

Measuring the first wave from its high to its low lays out the possibilities for us. Straight away we notice that the Elliot wave has been performing perfectly, with wave 2 retracing 61%, and wave 3 pushing to the 261% extension. Wave 4 did not move below the height of wave 1, making this a perfect Elliott so far.

The last criteria for the Elliot is that the 5th wave is usually the largest wave, therefore we should expect a sharp increase to come. Since we are already in the 5th wave we should look for the next target. The next interest point on the fib lines is the 423% extension, which will bring us to the target of $0.143.

So far ADA fits the criteria for a perfect Elliott wave quite nicely, but whether we continue higher to complete the 5th wave is up to this hourly triangle. Will it break through to the top and complete the wave, or will the triangle fail and push us back down to $0.07? Let us know what you think in the comments below!

Disclaimer: Keep in mind this not investment or trading advice, just the opinion of our analysts. As always, do your own research, make your own decisions.

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