Cardano price eyes $3, but ADA chart fractal hints at a potential 40% correction
The ADA/USD exchange rate has moved further into its "overbought" area, suggesting that a trend correction might follow suit. Cardano blockchain's native asset ADA reached a new record high on Aug. 23 as investors pinned hopes on an upcoming smart contracts feature that expects to boost the cryptocurrency's adoption. The ADA/USD exchange rate topped out at $2.899 around 09:00 UTC, raising anticipations that it would easily close above $3 in the coming sessions.
Many analysts, including pseudonymous chartist PostXBT, noted that the Cardano token had entered a "price discovery mode." Meanwhile, David Gokhshtein hinted that ADA/USD might continue its bull run until Sep. 12, the day Cardano would integrate smart contracts feature to its blockchain via a so-called "Alonzo" upgrade.
In detail, Alonzo upgrade introduces a native smart contract development language called Plutus to the Cardano ecosystem. Plutus is already available for testing and brings functional programming to smart contract creation to everyday users. As a result, ADA bulls anticipate the token's adoption to boom in the sessions ahead as Cardano attracts dapp developers—operating in the emerging decentralized finance (DeFi) and non-fungible tokens (NFT) sector—to its smart contracts ecosystem.
Overbought risks
But Cardano's technical indicators predict a short-term shock, something that might have the ADA/USD corrected lower by as much as 40% despite maintaining its long-term bullish outlook. The Cardano token's daily relative strength index (RSI) has ventured deeper into its overbought territory, at around 83. Traders consider an RSI reading above 70 as overvalued. As a result, it prompts them to sell the asset to secure maximum profits.
For instance, a run-up in ADA/USD rates in the first quarter of 2021 pushed its RSI reading above 90. Later, the pair started consolidating sideways while maintaining support near its 50-day exponential moving average (50-day EMA; the scarlet wave).
ADA price now sits atop 114% month-to-date and 1,511% year-to-date profits. At the same time, an oversold RSI pictures an interim profit-taking scenario. So if the Q1/2021 fractal repeats, ADA's next line of support comes to be near its 50-day EMA at $1.73, almost 40% below the current prices of $2.83. But a correction does not necessarily exhaust Cardano's long-term bullish outlook. Given the potential success of its Alonzo upgrade, the project could end up attracting more speculative upside bids for its ADA token. As a result, the ADA/USD exchange rate expects to remain in a price discovery mode.
Top Cryptocurrencies with Price Predictions
| # | Crypto | Prediction | Accuracy | CVIX | Price | 24h | 7d | Market Cap | 7d price change | |
| 1 |  BTC |
Bitcoin predictions | 83.6% | 25 | $57 792.76 | -3.69% | 2.25% | $1 141 693 733 484 |  |
|
|---|---|---|---|---|---|---|---|---|---|---|
| 2 |  ETH |
Ethereum predictions | 75.6% | 46 | $2 287.40 | -3.90% | -1.87% | $275 265 306 406 |  |
|
| 3 |  USDT |
Tether predictions | 92% | 1 | $0.999688 | -0.05% | -0.05% | $118 748 152 081 |  |
|
| 4 |  BNB |
Binance Coin predictions | 78.8% | 33 | $533.12 | -4.39% | 3.01% | $77 800 355 328 |  |
|
| 5 |  SOL |
Solana predictions | 79.2% | 41 | $130.32 | -2.69% | -2.21% | $61 019 240 479 |  |
|
| 6 |  USDC |
USD Coin predictions | 90.8% | 1 | $0.999890 | 0% | -0.02% | $35 521 356 396 |  |
|
| 7 |  XRP |
XRP predictions | 81.2% | 36 | $0.579047 | -1.14% | 8.07% | $32 650 160 969 |  |
|
| 8 |  DOGE |
Dogecoin predictions | 81.6% | 28 | $0.099326 | -6.17% | -4.10% | $14 499 890 393 |  |
|
| 9 |  TON |
Toncoin predictions | 72% | 59 | $5.41 | -4.58% | 4.61% | $13 699 208 585 |  |
|
| 10 |  TRX |
TRON predictions | 82% | 23 | $0.148267 | -0.66% | -4.07% | $12 853 314 374 |  |
|
| 11 |  ADA |
Cardano predictions | 80.8% | 35 | $0.329334 | -4.02% | -4.00% | $11 843 076 007 |  |
|
| 12 |  STETH |
Lido stETH predictions | 90.8% | 1 | $2 941.39 | -0.40% | -3.32% | $10 258 752 564 |  |
|
| 13 |  WTRX |
Wrapped TRON predictions | 94.8% | 1 | $0.116354 | -0.46% | 0.23% | $10 171 995 609 |  |
|
| 14 |  WBTC |
Wrapped Bitcoin predictions | 91.6% | 1 | $65 806.83 | 0.78% | -2.68% | $10 083 957 608 |  |
|
| 15 |  AVAX |
Avalanche predictions | 73.2% | 52 | $23.36 | -4.52% | -2.88% | $9 478 931 682 |  |
