ADA is one of the best performing in the crypto market in 2021. Altcoins climb to 3rd place in terms of market capitalization and have reached significant milestones.
After overtaking DOGE, XRP and BNB, ADA is now trading at $ 2.37, down 2.1% on the daily chart and 0.2% on the weekly chart.
ADA moves sideways up Street important support | Source: Tradingview
Analyst Justin Bennet has been closely following the ADA price action lately. The cryptocurrency saw a lot of movement in September with a sharp drop on the 7th, followed by a relatively quick rebound to the current zone highs.
$ ADA probably sees $ 2 if $ 2.30 fails on a daily close basis.
– Justin Bennett (@JustinBennettFX) 16.09.2021
“ADA could go back to $ 2 if it doesn’t hold $ 2.30 on a daily closing basis. When BTC drops to $ 40,000, ADA is expected to be closer to $ 1.65. “
At the time, ADA was around $ 2.7 with support at $ 2.60, $ 2.47, and $ 2.30, respectively. As price resumes its downtrend, the final hurdle for the bears will be the $ 2.30 support.
Bennet said the price could quickly drop to $ 2 if that defense is lost. ADA has recently seen “an ascending line of channel support intersecting a horizontal plane” since it left the Aug. 7 crash.
“I still think there’s a good chance ADA will trade at $ 2 this month. However, as I said last week, a daily close below $ 2.30 is required to confirm the collapse.
Alternatively, if the bulls make their higher highs again, ADA can continue its uptrend. However, the price is hovering below the trendline formed in the past few days and looks like the downside risk will increase over the weekend.
Source: Justin Bennet
What could Bitcoin signal for ADA in the short term??
In the crypto market, most assets rise in correlation with Bitcoin when big moves occur, whether bullish or bearish. ADA can benefit from this phenomenon when the price is at an important point or when it falls back to $ 1 on its own.
The next few days will be crucial for the entire market as Bitcoin’s price action will determine whether bulls or bears are in control. When asked, “Do you think a BTC close below $ 40,800 will end the bull run?” Said Bennet:
“A weekly close in this range would not be good, but the lack of larger macro highs should be enough. If we were in a bull market, we would see Bitcoin take back $ 53,000, $ 65,000, etc. As simple as that.”
On the contrary, there are also cases where Bitcoin wins more when altcoins crash like ADA. Analyst Pentoshi says:
“I think we will see more capital inflows into Bitcoin, especially as discussions about Bitcoin Exchange Traded Funds (ETFs) are fueling next month. That’s not to say that there are no exceptions and options with altcoins. Of course there will be. But the “altcoin season” itself is seasonal, that is, it does not take place all year round. “
The source: Pentoshi
With that in mind, the analyst recommends investors monitor Bitcoin’s dominance to manage risk. In the fourth quarter of 2021, investors appear to be feeling more uncertain about the direction of the crypto market.
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According to Newsbtc