Cardano Price Forecast as ADA Loses Grip at $0.38 Level – Can ADA Reach $3 This Year?
ADA, the cryptocurrency that powers Cardano’s smart contract-enabled layer-1 blockchain protocol, is coming under selling pressure on Friday in line with broader cryptocurrency markets. ADA/USD last changed hands at $0.37s, down around 1.5% on the day, with the crypto weighed by downside in US stocks and upside in the US dollar and returns in the wake of a warmer-than-expected US inflation report.
The PCE price index report for January was released earlier on Friday and revealed a bigger-than-expected jump in MoM core inflation to 0.6% from 0.4% in December, which was also revised higher from the previous estimate of 0.3%. The latest data has sparked fears that the Fed may have to raise interest rates further, hence the risk-off reaction in crypto and traditional asset classes.
ADA’s latest decline means it is now over 10% below previous monthly highs of $0.42s and is back below its 200-day moving average of $0.3815. Cardano is now at a technical crossroads and today’s close will be key.
Where next for Cardano (ADA)?
ADA is currently testing an uptrend that has been in play since late 2022. If it breaks below this trendline and its 50DMA just below $0.37, then a drop back to a recent double bottom in the $0.35 area seems likely. However, if the crypto bulls regain control and can push ADA to close Friday’s session back above the 200DMA, a retest of the recent highs in the $0.42 area will become more likely.
Can Cardano (ADA) Reach $3 This Year?
The Cardano ecosystem will almost certainly continue to grow in 2023, thanks to its large and dedicated community of supporters and developers who continue to launch useful new protocols on the blockchain, including most recently the over-collateralized algorithmic stablecoin Djed. Assuming cryptocurrency markets continue their gradual recovery from last year’s highly oversold levels, ADA can certainly continue to appreciate.
But with US inflation remaining sticky at high levels and the economy still humming along, the outlook for a significant easing of financial conditions is not good. In other words, 2023 will likely see at least three more Fed rate hikes, and may not see any rate cuts until the end of the year. For the crypto glut to truly return, a series of interest rate cuts are likely to be necessary.
That being said, it seems unlikely that ADA will reach $3.0 (nearly 10x gain from current levels) this year. But bulls should not lose heart. Cardano has an excellent chance of retaining its place as a dominant blockchain, and as broader crypto adoption increases over the coming years and decades, a rise to $3.0 at some point is highly likely. But bulls must be patient.
ADA options to consider
ADA’s short-term outlook is mixed. Traders looking for quick gains may want to consider other tokens with high potential, such as those sold in pre-sales promising upcoming crypto projects. We’ve reviewed some of the top contenders in this list of the top 15 cryptocurrencies for 2023, as analyzed by Crypto news Industry Talk team.
The list is updated weekly with new altcoins and ICO projects.
Disclaimer: The Industry Talk section contains insights from crypto industry players and is not part of the editorial content of Cryptonews.com.
