Signal price

Bulls Eye a $0.50 return on Hard Fork updates

Key ideas:

  • On Friday, cardano (ADA) partially reversed Thursday’s 3.12% loss with a 1.93% gain.
  • Market reaction to the Ethereum merger continued to test buyers. However, progress towards the Vasil Hard Fork (HFC) remained positive for ADA.
  • Technical indicators are bullish with ADA trading above the 100-day EMA, putting $0.500 into play.

On Friday, ADA rose 1.93%. Partially reversing a 3.12% loss from Thursday, ADA ended the day at $0.475. Friday’s gain was only the second of the week, with the US CPI report and market reaction to the Ethereum merger weighing heavily.

After a limited start to the session, ADA fell to a low of $0.455 in the early afternoon. ADA broke through the first major support level (S1) at $0.458 before rallying to a last-hour high of $0.475. Despite the late rally, ADA failed to reach the first major resistance level (R1) at $0.478.

Market reaction to the Ethereum (ETH) merger remained a headwind, while investor sentiment towards next week’s Vasil hard fork provided support.

In the US, better than expected consumer sentiment numbers and falling bets on a one percentage point Fed rate hike were also crypto positive. According to preliminary figures, Michigan’s consumer confidence index rose from 58.2 to 59.5. However, sentiment remained well below pre-COVID-19 levels. In February 2020, the index stood at 101.0.

Following this week’s US economic indicators, the probability of a one percentage point hike in Fed rates fell from 23% to 18% on Friday. However, as the fear of the Fed subsided, fears of recession resurfaced, testing the appetite of buyers.

Entry Exit HK Hard Fork Updates support ADA bullish move

As of September 16, the ADA Hard Fork mass indicator updates are as follows:

  • Twenty-five exchanges are ready for the hard fork.
  • Twenty-one exchanges are in progress, with Coinbase and Kraken still reporting ongoing upgrades.
  • Twenty-three have not yet started the upgrade process.

Among the top 12 exchanges by liquidity:

  • Seven exchanges are ready for the hard fork: AAX, Binance, Bittrue, BKEX, MEXC, Upbit and WhiteBit, with four in the works including ChangellyPro, Coinbase, HitBTC and XT.com.
  • However, one exchange has yet to begin the upgrade process: ZB.com.

Investors will be looking for Coinbase and Kraken to complete the upgrade process to provide ADA price support. The next hard fork event date is September 19. The mainnet update proposal must be submitted by September 19 to trigger the September 22 hard fork event.

Following the successful upgrade of 75% of SPO nodes to v1.35.3, the crypto market is tracking two critical mass indicators, namely:

  • Around 25 exchanges need to be upgraded (representing around 80% of ADA’s liquidity). Currently, IOHK is reporting exchange upgrades representing 55% of ADA liquidity.
  • TVL’s Top 10 Dapps confirm they’ve upgraded to 1.35.3 in pre-production and are ready for mainnet.

As of September 16, the status of Top Dapps by TVL was as follows:

The next update will be available on Monday at 1600 UTC.

ADA Price Action

This morning, ADA was up 0.63% at $0.478. A mixed start to the day saw ADA fall to a low of $0.472 before rallying to a high of $0.483.

ADA broke through the first major resistance level (R1) at $0.482 before pulling back.

ADAUSD 170922 Daily Chart

Technical indicators

ADA needs to avoid the $0.468 pivot to retarget the first major resistance level (R1) at $0.482 and the morning high of $0.483. The HK Vasil hard fork updates will continue to influence as we approach the hard fork date of September 22.

However, with no daily updates on exchange and dApp upgrades until Monday, any news from Input Output HK and broader market sentiment will provide direction today.

In the event of an extended crypto rally, ADA may test the second major resistance level (R2) at $0.488. The third major resistance level (R3) is located at $0.508.

A drop through the pivot would bring the first major support level (S1) at $0.462 into play. Barring an extended sell-off, ADA should avoid sub-$0.450 and the second major support level (S2) at 0.448 $. The third major support level (S3) is located at $0.428.

ADAUSD 170922 Hourly Chart

This morning, the EMAs and the 4-hour candlestick chart (below) sent a bullish signal.

ADA was above the 100 days, currently at $0.475. The 100-day EMA has reduced to the 200-day EMA, with the 50-day EMA closing in on the 100-day EMA, delivering bullish signals. A move of ADA through the 200-day EMA ($0.481) and R1 ($0.482) would support a run to R2 ($0.488).

However, a drop in the 100-day EMA ($0.475) and the 50-day EMA ($0.470) would put S1 ($0.462) into play.