Cardano (ADA/USD) Facing the Big Test Again at the 20-Weekly SMA
Skerdian Meta • 1 min read
Cardano made a very impressive run this year, increasing from $0.15 to $2.50 by the middle of May. But, the big crash came after the reversal in the crypto market, and Cardano dived below $1, to $0.92 in the following two weeks.
But the 20 SMA (gray) held as support on the weekly chart. The price formed a doji candlestick above it, and the ADA/USD started to bounce back up. But, the bounce didn’t last long, and this pair has started to slide down again, as the crackdown in Bitcoin mining in China accelerates.
The People’s Bank of China stated n their WeChat account that cryptocurrency is not real currency and “should not and cannot be used as currency in the market.” That announcement caused Bitcoin and other coins to tumble in value, and the further interventions that took place at the weekend are hurting the market even more.
The Sichuan Provincial Development and Reform Commission and the Sichuan Energy Bureau issued a joint notice, demanding the closure of 26 suspected crypto mining projects by next Sunday. It is worth mentioning that Sichuan is China’s second-biggest Bitcoin mining province. Other regional mining centers, including Xinjiang, Inner Mongolia and Yunnan, have ordered crackdowns on bitcoin mining.
Cardano is trading around $1.31 now, and it continues to slide lower. It is facing the 20 weekly SMA again at the moment, so we will see if this moving average holds again, since other countries, like El Salvador and Paraguay, are legalizing cryptocurrencies, so we are holding onto our buy signal here.