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Cardano is currently trading within a bullish order block, and an analyst has identified possible price scenarios and how to profit from them.
Notably, market commentator “TuffyBro” shared this perspective in a recent TradingView analysis. The outlook highlighted how the recent ADA retracement has pushed it into a major rebound area and how it could react.
Cardano Reaches Bullish OB
ADA is down 18.5% in the past seven days, joining a broader market trend. However, the analysis shows it has now reached a bullish order block, where bulls have historically stepped in and defended lower prices.
This demand zone lies between $0.384 and $0.363, and the analysis suggests it could cushion the current sideways price trend. However, TuffyBro is on the lookout for a reaction or a lower timeframe reversal pattern to confirm a possible rebound from here.
The analysis highlighted that a close above $0.384 on the 4-hour chart would further confirm that Cardano would rebound from the order block to target higher prices. Furthermore, he sees this as a good place to open a long position, given its excellent risk-to-reward ratio.
Notably, this is because his stop loss is just below the box. He identified that a daily close below the OB’s lower range at $0.363 would invalidate any bullish possibilities from the order block. From the coin’s current price of $0.38, this would represent a 4.47% decline.
Targets for a Recovery
Meanwhile, in a bullish scenario where ADA bounces from the bullish OB, the market watcher shared possible targets. The first is the fair-value gap (FVG) identified in the accompanying chart.
He described the FVG as a price magnet and the first possible area Cardano would rally to. Specifically, the gap lies between $0.434 and $0.450, and the asset would rally by 14% to 18% to fill up that area. Notably, the analyst suggested that traders take partial profits or move their stop losses to entry at this point.
Furthermore, the chart shows that the bearish OB is the subsequent target. The area between $0.47 and $0.483 is the resistance ceiling and the final point to take profit on the trade. ADA would have to increase by 23.6% and 27% to reach the areas.
Remarkably, the commentator noted that how ADA reacts at the bearish OB would determine if speculators would open a short position. According to him, an obvious rejection wick at the zone is a license to open a short position and trade it back to support. However, investors should not take this as financial advice.
Interestingly, this analysis is not alone in the possible $0.45 ADA target. A recent The Crypto Basic report also identified that this price mark is feasible, citing technical price developments.