This pattern tends to have an upward outcome for the asset’s price.
Analysts project that ADA could reach $1.50 in this bullish cycle.
Cardano (ADA) is one of the cryptocurrencies that has once again captured the market’s attention since Donald Trump’s victory in the United States elections.
As CriptoNoticias reported, at that time, the native currency of the Cardano network saw an 80% rise and reached a price of $1.30 in this cycle.
After reaching its cycle high, ADA entered a price compression zone, where the highs and lows converge, forming a technical analysis pattern known as a “bullish pennant.”
It is a triangular figure that generates a positive feeling among investors and It is characterized by a strong bullish movement (Pennant) followed by a period of price consolidation (Flag).
Usually, the breakout of the figure is resolved with a movement that goes in the same direction as the initial trend, that is, with a strong rise in prices.
For Ali Martinezfinancial markets analyst, ADA “must surpass this level to generate a bullish breakout,” which would allow it to overcome the resistance of $1.10 and reach a high of $1.50.
For his part, James Foord, economist and leader of the investment group The Pragmatic Investor, explains that ADA “could easily exceed $2 in the next month, but what happens next will depend on the cryptocurrency market in general.”
According to their analysis, updates to their ecosystem will be key to increasing activity in that environment, which would generate bullish momentum in the price of ADA. For him, the implementation of Hydra, a layer 2 solution on Cardano, could reach up to 1 million transactions per second, positioning it as one of the fastest networks.
This capacity will drive the adoption of decentralized applications (dApps), smart contracts and transfers, which in turn will increase the demand for ADA and, therefore, could generate bullish momentum in its price.
Bitcoin leads the market
As is often the case, it is bitcoin (BTC) that determines the general direction of the entire cryptocurrency market. CriptoNoticias has reported that The price of BTC is experiencing days of high volatility without showing a defined trend (up or down).
The market seems to be waiting for statements from Donald Trump, president-elect of the United States, that will give some greater indication of where his first economic measures will go.
Let us remember that Trump has made numerous promises that, if realized, would greatly benefit the digital asset industry.. Among these promises is the creation of a strategic reserve in bitcoin and the enactment of laws that would favor the cryptocurrency mining industry.
