Cardano, the popular layer-1 network, has seen little movement this year, but several fundamentals and technical patterns point to a potential bullish breakout.
Cardano (ADA) was trading near the critical support level at $1 on Tuesday, down about 27% from its December highs. But, it may be on the verge of a significant bull run if certain technical patterns hold.
First, ADA has entered the fourth phase of the Elliott Wave pattern. The first wave occurred between October 2023 and March 2024, followed by a corrective second wave from March to August.
The third wave extended until November, during which the coin reached the 38.2% Fibonacci retracement level at $1.3375. If the final impulse wave materializes, ADA could climb to the 61.8% Fibonacci level at $2, representing a potential 110% increase from its current price.
Second, Cardano has formed a triple-bottom chart pattern at $0.2636, with the neckline at $0.8130. The coin has broken above this neckline and successfully retested it, a bullish continuation signal.
Additionally, ADA has formed a bullish pennant pattern, consisting of a tall vertical line and a consolidating triangle. The triangle is nearing its confluence point, signaling that a strong bullish breakout could occur soon.
Therefore, ADA price will likely rise to the 50% retracement level at $1.6685 followed by the 61.8% point at $2.01. This prediction may take longer to happen since this is a weekly chart.
Potential catalysts for ADA price
Cardano has several catalysts that could drive its price higher in the near term.. First, odds of a spot Cardano ETF have risen to near 60% on Polymarket, up from this month’s low of 20%. An ETF approval would lead to more hype and inflows from institutional investors.
Second, Cardano’s futures open interest has remained strong despite the coin being in a bear market. Open interest is currently above $1.2 billion, indicating sustained demand in the futures market. This divergence could lead to further upside for ADA.
Further, Cardano price may benefit from the upcoming Midnight launch and its BitcoinOS integration. Midnight will be its zero-knowledge scaling solution, while BitcoinOS will make it interoperable with the Bitcoin (BTC).
