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Buying or Shorting Solana and Cardano? Technical support & resistance

December 4, 2021 14:27
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This post will talk about the latest important news connected with Solana (SOL) and Cardano (ADA) and where the price of these two cryptocurrencies could move in the upcoming period.

The cryptocurrency market remains under pressure after the news of a new COVID variant that may initiate new lockdowns around the world. The Director of the Centre for Epidemic Response and Innovation in South Africa, Prof. Tulio de Oliveira, said:

“This variant surprised us; it has a big jump on evolution and many more mutations than we expected. If it indeed turns out to have strong immunity to the vaccine, then vaccination efforts so far may become ineffective, and nations around the world may look at enforcing new lockdowns “.

The price of most public cryptocurrencies has collapsed in a relatively short period, and some market observers have expressed concerns that the cryptocurrency market may have an even bigger drop in the upcoming days.

After hitting record highs above $259, Solana has encountered losses of more than 20% in less than several weeks. The price has stabilized now above $195, but a break below $180 support would indicate that Solana could probably test the $160 support. It is very hard to measure the real fundamental value of this cryptocurrency and predict where Solana's price will go in the long term; still, according to some analysts, there are plenty of reasons to be bearish on Solana at the current price. If you are keen on trading Solana or Cardano, we suggest that you try Capital (review). Ready to try? Here is a free demo account from Capital.

Cardano (ADA) also remains in a tough position, its price has collapsed from record highs above $3, and for now, we don't see the light at the end of the tunnel.

The cryptocurrency market is easily affected by unpredictable events, and most traders are now taking advantage of declining needs. The price of these two cryptocurrencies is also in correlation with Bitcoin, and if the price of Bitcoin drops below $50000 support, we can see new lows for Solana and Cardano.

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Technical analysis of Solana (SOL)
Solana is one the most performant blockchain in the world that is designed to keep fees low for applications with billions of users. It has the average fee per transaction stands at $0.00025, and in the last several months, Solana has attracted tens of thousands of developers to its network.

Solana has weakened from its record highs, and the risk of further declines is not over yet. The price has stabilized now above $195, but we can expect that the price could test a support level at $180 in the upcoming days or even hours. A break below $180 would indicate that Solana could probably test the $160 support according to technical analysis rules.

Solana remains in the “bearish phase”; still, if the price advances above $220 resistance, the next price target could be located around $240.

Technical analysis of Cardano (ADA)
Cardano is an entirely open-source that represents identity, value, and governance, all in one platform. Cardano is connected with various payment programs, and it has its own cryptocurrency known as ADA. Cardano (ADA) has collapsed from record highs above $3, and for now, everything indicates that we could see even lower prices. The price of Cardano currently stands around $1.56, and at this value, the total market cap of Cardano is around $51 billion.

On this chart (the period from February 2021), I marked current support and resistance levels to help traders understand where the price could move. The more often price tests a level of resistance or support without breaking it, the stronger the resistance or support area is. The current support level is $140, and if the price breaks this level, it would be a “SELL” signal, and we have the open way to $120. If the price drops below $120, which represents very strong support, the next target could be located around $100 or even below. Cardano remains in the “bearish phase”; still,  if the price advances again above $2, the next resistance could be located around $2.20.

Conclusion
The cryptocurrency market remains under pressure after the news of a new COVID variant that may initiate new lockdowns around the world. The price of most public cryptocurrencies has collapsed in a relatively short period, and some market observers have expressed concerns that the cryptocurrency market may have an even bigger drop in the upcoming days. Solana and Cardano have collapsed from their recent highs, both cryptocurrencies are in correlation with the price of Bitcoin, and if the price of Bitcoin drops below $50000 support, we can see new lows for Solana and Cardano.

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