Cardano: Dubious Speculation

Benjamin Cowen

Introduction to Cardano and Ada

The discussion revolves around Cardano and its native token, Ada. The speaker reflects on previous discussions about Ada, particularly when it was at $1.20, and notes the resistance level around $1.20 plus or minus 10 cents.

Market Analysis

  • Higher Highs and Lows: The pattern of higher highs and higher lows in Ada's price movement is observed, forming an expanding broadening wedge.
  • Pattern Repetition: The speaker suggests that this pattern has repeated itself, with Ada dropping back down after reaching a high, similar to what happened in the previous year.
  • Quantitative Easing (QE): The potential impact of QE on the market is discussed, with the suggestion that Ada's breakout might be dependent on QE resuming.

Ada's Performance

  • Comparison to 2021: The speaker notes that Ada's current performance is different from 2021, where it saw a more significant rally.
  • Support Levels: Discussion on support levels, particularly the bull market support band, and the potential for Ada to find support or break down.

Bitcoin and Altcoin Season

  • Bitcoin Dominance: The impact of Bitcoin dominance on altcoins is discussed, with the note that dominance typically goes down in post-halving years.
  • Altcoin Market: The altcoin market is seen as chasing the narrative of Bitcoin season to alt season, with Ada and other altcoins affected by this dynamic.

Economic Indicators

  • 10-Year Yield: The 10-year yield is watched for signs of topping, which could indicate a shift in the market.
  • Dollar Index (DXY): The potential for the DXY to top in Q1 2025 is mentioned, which could influence the crypto market.

Cardano Tools and Data

  • Website Tools: Mention of a website that offers tools for analyzing assets like Cardano, including dominance, risk level, and ROI.
  • Ada Dominance: Discussion on Ada's dominance and its potential bottoming out around the same level as in previous cycles.

Conclusion

  • Short-Term Weakness: The speaker suggests that Ada might show short-term weakness but emphasizes the importance of managing risk and considering various patterns and scenarios.
  • Dependence on QE and Economic Factors: The break-out of Ada is seen as dependent on the resumption of QE and favorable economic conditions.