Cardano (ADA), one of the most recognized altcoins, is showing mixed movements in the market. Despite gaining over 15% in the past week, the token is struggling to maintain its momentum. Currently trading below the crucial $1.20 level, ADA leaves traders and investors questioning whether a breakout or a breakdown lies ahead.

Broader Market Overview

ADA’s price is currently in a consolidation phase, with its movements reflecting the broader cryptocurrency market sentiment. Bitcoin’s increasing dominance is drawing much of the market’s attention, leaving altcoins like Cardano moving sideways. However, ADA’s recent pullback doesn’t signal the end of its upward potential.

The key to understanding ADA’s next move lies in analyzing its support and resistance levels. If it manages to stabilize and bounce off current support, a bullish resurgence could be on the cards.

Short-Term Analysis: Support and Pullback Levels

In the short term, Cardano’s price is testing significant support regions. Analysts have identified a key orange support zone between $0.94 and $1.11, which could serve as a critical entry point for new investors.

However, a breakdown below $1.05 would invalidate the current bullish structure, leading to a potential larger pullback. This would shift the narrative from an upward rally to a more cautious outlook, with the possibility of revisiting lower levels.

If ADA holds steady above $1.11, it could attempt to push toward higher targets. Initial upside levels include $1.42 and $1.49, with more ambitious goals of $1.72, $2.36, and even $2.95 in the event of a strong bullish rally.

Key Resistance Levels to Watch

For ADA to signal a definitive breakout, it must overcome a series of resistance levels:

1. Immediate Resistance: A break above $1.25 would indicate renewed upward momentum.
2. Major Resistance: A push beyond $1.32 to $1.33, marked as the yellow wave 1 high, would confirm a bullish trend reversal.

If these levels are breached, ADA could accelerate toward its next targets, potentially rallying above $1.50.

Bitcoin’s Role in ADA’s Movements

Bitcoin’s dominance has been a key factor influencing altcoin performance. While Bitcoin is currently attracting most market attention, Cardano’s sideways movement is part of a larger setup that still allows for higher price targets.

Bitcoin’s stability is essential for ADA’s potential breakout. If Bitcoin maintains its current trajectory, Cardano may find the market conditions favorable for upward movement.

Near-Term Predictions for Cardano

If Cardano’s current microstructure holds, the following scenarios could unfold:

1. Bullish Scenario: A break above $1.25 sets the stage for $1.42 as the next major target. Further extensions could take ADA toward $1.49 or $1.55, especially if broader market sentiment turns optimistic.
2. Bearish Scenario: A failure to hold above $1.11 and a drop below $1.05 could signal a larger wave four pullback, leading to revisited lows within the $0.94 range.

Conclusion

Cardano’s price movement remains at a critical juncture. While the short-term outlook presents challenges, the potential for a breakout is still in play. Traders should watch key resistance levels and monitor Bitcoin’s market dominance for clearer signals.

As the broader market evolves, ADA continues to stand as a resilient altcoin with significant potential for recovery and growth. The coming days will be pivotal in determining whether Cardano can regain its bullish momentum or face a deeper pullback.