Cardano was one of the best in the cryptocurrency market in recent days, and the price of this cryptocurrency has reached a new all-time high above $ 2. The current price is around $ 2.13, and if you decide to trade Cardano (ADA), you should always use a stop-loss order because the risk is still high.
Fundamental analysis: The current price appreciation has a less fundamental background
Cardano has been exploding since the beginning of May and this cryptocurrency continues to trade in a bull market. ADA daily volume is still high, but the current price appreciation has a less fundamental undertone.
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“Cardano is overvalued, the market is always looking to the future and the current price is based on the anticipated future value, but more than that, I think if we go, being honest here, the current Cardano price is going up quite a bit on the hype versus to the actual demand for the token based on the utility and need of developers and users and the like, ”said cryptocurrency trader and influencer Lark Davis.
The cryptocurrency market remains under pressure and the prices of most cryptocurrencies fell to their lowest levels in months. From its peak of around $ 64,895, Bitcoin is currently down more than 20%, indicating that it has entered a bear market.
The cryptocurrency market is losing its value this week, the price of Cardano can easily roll back below the $ 1.8 level, and it may not be the best time to invest in this cryptocurrency. If larger investors unexpectedly sell a substantial amount of Cardano, it could result in an extreme correction, as a small price change could lead to liquidations by highly-leveraged traders.
Technical Analysis: $ 2 Represents Strong Support Level
This cryptocurrency has made a huge leap in a short period and if you decide to buy Cardano ADA / USD, you should consider that the price could also weaken from current levels. It is also important to mention that the price of Cardano is generally correlated to the price of Bitcoin, and investors in this cryptocurrency should also have Bitcoin on their ‘watch list’.
Data source: tradingview.com
Cardano (ADA) is currently trading around the $ 2.13 level, but it would be a strong sell signal if the price falls below the $ 2 support. The next price target could be around $ 1.8 or even $ 1.5; even so, if the price jumps above $ 2.30, we have a clear path to $ 2.50.
Cardano has reached a new all-time high above $ 2, but this is probably not the best time to invest in this cryptocurrency. Cryptocurrency trader Lark Davis said that Cardano is overvalued and the current price appreciation has a less fundamental undertone. For now, there is no bear market risk, but if the price falls below the $ 2 support, it would be a strong ‘sell’ signal.