Chart by TradingView
The first week of 2022 is about to become one of the most bearish weeks in crypto over the past year. Just as the overall sentiment, ADA could not resist the downtrend and is slowly descending towards the $1 mark.
Key Support levels: $1, $0.8
Key Resistance level: $1.2, $1.5
The support at $1.2 could not hold off the selling pressure as the price closed below this critical level on the daily timeframe yesterday. The latter becomes the first major level of resistance. On the other hand, the nearest support now lies at $1, and ADA appears on a clear path to test this critical area.
Trading Volume: The volume level was not significant when the price dropped below $1.2, probably because this happened during the weekend. This shows some lack of conviction on the sellers’ side and will have to be re-evaluated on Monday.
RSI: The daily RSI continues to slip after going through a lower high. The short-term trend is clearly bearish, however, the RSI has not reached the oversold area, sitting at 37 points at the time of this writing.
MACD: The MACD is also bearish after the histogram and moving averages crossed to the negative side last Wednesday once the crypto market selloff started. Since then, the bearish momentum has only intensified and there are no signs of a reversal yet. For this reason, ADA is likely to test the $1 level.
The current bias is bearish.
The support at $1.2 failed to cease the negative momentum, which has only increased over the past few days. As mentioned above, ADA must hold the $1 mark as this is a key psychological support, which buyers must defend. If nothing major takes place, we can expect to see ADA retest this critical level in the coming days.
