Cardano recovers back to the key level at $0.42. Is it now a buy?

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Cardano recovers back to the key level at $0.42. Is it now a buy?

By Motiur Rahman - min read

After garnering a 15% gain in the past one week, Cardano (ADA/USD) is showing glimpses of recovery. A week ago, the cryptocurrency traded at $0.33 bottom after an underwhelming Vasil hard fork. The gains in the week took ADA back to $0.42. It has since retreated and exchanged hands at $0.40 at press time. Should this be a suggestion for a buy trade?

Let’s make it clear – Cardano trades below where it was when the Vasil hard fork occurred on September 22. It makes sense to claim that the cryptocurrency is yet to show enthusiasm as was expected after it underwent the Vasil hard fork. Nonetheless, on-chain activity is being reported to be rising, in line with the price recovery.

As of Wednesday, Cardano is said to have witnessed a 75% increase in network activity in the last 30 days. As CoinJournal reported, NFT volume is rising, hitting $3.0 million on October 17. The activity underlines that Cardano adoption continues to grow. Consequently, ADA has been touted as a cryptocurrency to watch in the next bull cycle. The price recovery could still hit a snag going by the price action at $0.42.

ADA pauses after hitting the $0.42 resistance

A bullish price movement in the week took ADA to the resistance at $0.42. From the daily chart below, the cryptocurrency has paused at the resistance. The level coincides with the 50-day MA, which has already been keeping bulls muted. 

Source-TradingView

Looking at the RSI, the indicator has shifted from the oversold region after the price pump. The indicator shows we are yet to get into the overbought region. ADA buyers are still active as the RSI remains above the midpoint.

Should you buy ADA?

While the weekly surge is positive for ADA, the token is still not at an attractive buy zone. To consider a bullish case, the cryptocurrency must break and clear above $0.42. At the current level, ADA remains vulnerable to a correction to the lower levels.

Where to buy ADA 

eToro

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