Cardano price action has still remained below the $1 level in delicate of corrections over the last seven days. This correction, which affected the entire cryptocurrency industry, caused Cardano to fall below the $1 level again in December by 18%.

Although the broader trend suggests: a possible movement in a weekly time frame towards a fresh record high (ATH), latest technical analysis on TradingView opened up the possibility of further correction towards USD 0.43 before another powerful move up.

Current price movements highlight resistance and a cooling period

According to technical analysis Cardano (ADA) price action. during the weekly candle timeframe, the cryptocurrency encountered significant resistance around the $1.2046 level. This resistance came later Cardano’s extraordinary growth of 205%. from $0.4322 at the end of October to $1.32 at the end of November.

Interestingly, this unusual price escalate has caused Cardano to form significant lows that serve as support levels for the price. Moreover, the rally ended with Cardano entering the overbought zone on the Relative Strength Index (RSI). The rally ended with Cardano trading at 82.87 on the RSI, but has since returned to a cooling/correction period with buying pressure consolidating at the time of writing.

Cardano’s consolidation has opened up prospects for the further direction of its development, with significant purchase volumes observed during recent trading sessions.

A deep correction could test critical support at $0.43

While the long-term outlook remains bullish, the analysis highlights a deep correction scenario that could cause Cardano’s price to decline further in the brief term. With this in mind, the analyst indicates support levels to which ADA may return in the event of a deeper correction. The first key level at $0.7683 has already proven its importance by acting as a reaction zone in recent price movements.

Below this amount, $0.4322 provides final support for the current bullish leg. This means that ADA needs to hold above the $0.43 support level for the bullish trajectory to remain valid. Failure to stay above $0.43 will likely result in further price declines and a change to a bearish outlook at this point.

The analyst also identifies $0.3166 and $0.2427 as major support. These levels represent Cardano’s lowest support during the previous bear market and are considered less likely to be breached on longer declines.

Despite the potential for a deep correction, Cardano the latest market behavior and purchasing trends suggest a promising long-term prospects. At the time of writing, ADA is trading at $0.912 and is up 2% in the last 24 hours. Once the current resistance at $1.2046 is cleared, ADA will be in a good position to break the record high of $3.09 and possibly set fresh highs in the current cycle.

Featured image created with Dall.E, chart from Tradingview.com