Cardano (ADA) rebounded to above $1.40 on Monday after seeing a sharp decline on Sunday and was helped by bullish sentiment among investors on the overall crypto market and positive development surrounding the upcoming Alonzo upgrade. At the time of writing, the trading price of ADA/USD is approximately $1,45.
Cardano’s Purple Phase of the Alonzo Hard Fork Successfully Completed
Late last week, IOHK, the company behind Cardano, confirmed that the purple phase of the Alonzo hard fork had been successfully completed and its testnet was up and running. The company also provided a schedule for the HFC (Hard Fork Combiner), indicating that the Ethereum killer could launch all of the major smart contract features by the end of this month or early next month.
With the upcoming upgrade of the Cardano network, it will be better prepared to bear the cost of Ethereum and other competitors in the DeFi space, which offers a higher level of transaction processing, higher scalability, lower energy consumption and lower trading costs. Charles Hoskinson, the co-founder of the blockchain network, has confirmed that once HFC occurs, developers can start using Plutus code to write smart contracts on the network.
Several analysts are still optimistic about ADA’s outlook in the coming weeks. For example, the head of the mint office under the pseudonym “Guy” predicts that the price of Cardano’s tokens will be as high as $4 to $5 by the end of 2021 after a critical upgrade to the network. However, he warned that the upward trend of this cryptocurrency depends on the further rise of the market leader Bitcoin.
At the same time, Michaël van de Poppe, another cryptocurrency strategist, made a somewhat cautious prediction for Cardano, warning that it is currently in a downtrend towards Bitcoin. However, he expects a bullish divergence after testing support before the new breakout to the upside.
Important Levels to Focus on
If we look at the 4 hour ADA/USD chart, we can see that there is a strong bullish bias between most moving averages and momentum indicators. Nonetheless, MACD also indicated some interest in selling the cryptocurrency.
ADA/USD 4H chart. Source: TradingView
Cardano’s price has already passed the pivot point of $1,395, and increased buying interest may cause it to quickly break the key $1.50 mark. However, if bullish momentum lasts for a while, buyers could encounter resistance at $1,527 and then again at $1,627.