Renowned crypto analyst Benjamin Cowen has raised concerns about Cardano (ADA), suggesting that the current price action is reminiscent of the downward pattern experienced in 2019.
In a recent strategy session, Cowen highlighted the struggle Cardano faced during the second half of 2019 when the altcoin’s market structure witnessed continuous new lows.
The analyst explained that the latter part of 2019 was particularly challenging for Cardano, as the altcoin market slowly bled out without much excitement. Despite occasional price pumps during that period, they were ultimately short-lived and resulted in further declines for ADA.
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For example, the analyst pointed out that ADA experienced a 41% increase in 2019 from $0.035 to $0.050, and another 40% increase from $0.041 to $0.058. However, these pumps were unable to sustain upward momentum.
Cardano (ADA) 2023 Rally and Dip Below Bull Market Support
Drawing parallels to the present, Cowen noted that ADA experienced a similar rally in 2023, forming double-top patterns and subsequently dipping below the bull market support band.
The bull market support band is a technical indicator formed by the combination of the 20-week simple moving average (SMA) and the 21-week exponential moving average (EMA).
The analyst mentioned that despite ADA reaching new lows at $0.077 before seeing a rally, it still faded and fell to $0.017. He compared the 2023 market cycle to the 2019 cycle, while Cardano also saw a low point in 2018 at $0.028 and experienced a pump in 2019.
Cowen further highlighted the similarities, such as the formation of double tops and going below the bull market support band, suggesting that the current cycle might play out similarly to the previous one.
Monitoring ADA/BTC Performance
Furthermore, Cowen emphasized the importance of monitoring ADA’s performance against Bitcoin (ADA/BTC). He pointed out that in the previous market cycle, ADA didn’t reach its bottom against Bitcoin until the third quarter of 2019, and it remained at those lows for about six months before starting a rally. He speculated that a similar scenario could unfold in the current market cycle.
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The analyst warned that ADA has not yet convincingly found a level where it is holding lows against Bitcoin, reinforcing his concerns about Cardano (ADA) future performance.
Cardano (ADA) in the Market
At press time, ADA is trading at $0.30, with little or no change in price in the last 24 hours.
In conclusion, the analyst has issued a warning about Cardano, noting its similarities to the 2019 downward pattern. He speculates that ADA might find its bottom against Bitcoin in the third quarter of 2023, considering the resemblance to the previous market cycle. Following Cowen’s warning, traders and investors will keenly observe how the market unfolds for Cardano in the coming months.
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