Cardano (ADA) posted the best performance among major cryptocurrencies on June 6 as traders evaluated a key upgrade that promises to improve their blockchain smart contracts capability.
FOMO de hard fork Vasil
Known as ‘Vasil’, the hard fork will temporarily take place on June 29, 2022. Due to the euphoria associated with this upgrade, traders have begun to speculate more on the bullish prospect of ADA, which ‘outperformed other pioneering digital assets.
For example, the price of ADA rose more than 14% to $ 0.64 on June 6, compared to 6% of its main rivals, Ether (ETH), on the same day.
Thanks to the excitement of his upcoming Vasil Hard Fork, #ADA rose over 20% to become one of the best performing cryptocurrencies last week.
Current prices:#ADA – $ 0.637400#LINK – $ 7.98#XLM – $ 0.149126#UNITED – $ 5.34
Buy / sell crypto futureshttps: //t.co/QgaS0WtKde pic.twitter.com/1DWDxwFJ3Z
– BTCC (@YourBTCC) June 6, 2022
Thanks to the excitement of his upcoming Vasil Hard Fork, #ADA jumped over 20% to become one of the best performing cryptocurrencies last week. Current prices: #ADA – $ 0.637400 # LINK – $ 7.98 # XLM – $ 0.149126 # UNI – $ 5.34. Buy / sell cryptocurrency futures. https://t.co/QgaS0WtKde pic.twitter.com/1DWDxwFJ3Z- BTCC (@YourBTCC) June 6, 2022
Cardano’s price history also shows similar euphoric behaviors among traders in the days before the hard fork events. For example, Alonzo was upgraded in September 2021, which introduced features from smart contracts in the Cardano network, before an ADA price increase of more than 200%, as shown below.
Similarly, the hard fork Mary Cardano arrived in March 2021 before the ADA price rise of more than 1,600%.
Traps for ADA bulls
Previous price rallies after the hard forks also occurred in an expanded macro environment. At the time, interest rates were close to zero and the Federal Reserve was buying government bonds worth $ 120 billion every month.
Currently, the US central bank has become an intervention after seeing a steady rise in inflation. As a result, many analysts say there is now less liquidity in US dollars to buy more risky assets, including stocks and cryptocurrencies.
Cardano has bounced back under pressure from Fed escalation, with ADA trading nearly 80% below its September 2021 peak of $ 3.16, the graph below shows.
The price of ADA at $ 1?
Technically, ADA is now testing a resistance junction consisting of a downward trend and its 50-day exponential moving average (50-day EMA; the red wave) close to $ 0.66 and a horizontal trend line (the neckline) close to $ 0.62. it appears to be a “double bottom” pattern.
Breaking above the resistance joint may induce a breakout of the double bottom.
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According to the rule of technical analysis, traders measure the bottom double break target by adding the distance between the lower levels and the neck line at the breaking point. This gives a target of $ 0.87 for the month of June, which is about 40% up from today’s price and probably before the Vasil upgrade.
At a follow-up rally, ADA could also test its 200-day exponential moving average (200-day EMA; blue wave) close to $ 1 for breakout or withdrawal. However, the current macroeconomic risks are more likely to decrease.
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