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  • Cardano price shows signs of a reversal after a 30% correction.
  • The Tom DeMark Sequential indicator’s buy signal on the 4-hour and the 12-hour chart hints at a continuation of the bull rally.
  • Transaction data shows stiff resistance at $1.28 that could deter ADA’s upswing.

Cardano price showed signs of a recovery as bulls managed to keep ADA above a critical support barrier. Now, a reversal in momentum could put the so-called “Ethereum killer” back on track to $2.

Cardano price hints at a u-turn

Cardano price dropped nearly 30% after hitting an all-time high of $1.48 on February 27. Although ADA sliced below the 50 four-hour MA, bulls have kept the altcoin above the 100 four-hour MA  shows their strength.

The lower Bollinger band, which coincides with the 100 four-hour MA, provided an extra layer of support to the declining prices. If this barrier continues to hold, a volatile reversal move will be in play.

Adding credence to this bullish thesis is the TD Sequential indicator’s buy signal presented in the form of a green nine candlestick on both the 4-hour and 12-hour charts. This setup forecasts a one-to-four candlestick upswing, suggesting that Cardano price is heading to greener pastures.

ADA/USDT 4-hour and 12-hour chart

ADA/USDT 4-hour and 12-hour chart

While the technicals indicate a bullish outlook, investors need to pay close attention to the $1.26 resistance barrier.  

IntoTheBlock’s In/Out of the Money Around Price (IOMAP) model reveals that here roughly 32,800 addresses are holding 1.83 billion ADA. These holders are currently “Out of the Money,” based on this on-chain metric.  

Hence, they might be inclined to sell their token to break even. Only a decisive 4-hour candlestick close above $1.26 will kickstart Cardano price bull rally to $2.

Cardano IOMAP chart

Cardano IOMAP chart

On the other hand, the IOMAP cohorts also show that a 4-hour candlestick close below $1.07 will put 165,000 addresses underwater. Since these investors hold 3.52 billion ADA, such a move could be fatal for Cardano price.  

Slicing through this critical support barrier could trigger a 16% sell-off to the next interest area at $0.89.