Bearish Engulfing in ADA/USD – Can We See More Selling Today?
ADA/USD was closed at $1.461623 after placing a high of $1.494345 and a low of $1.420712. ADA/USD extended its gains for the 3rd
Arslan Butt•Monday, July 5, 2021•2 min read
The ADA/USD closed at $1.461623, after placing a high of $1.494345, and a low of $1.420712. The ADA/USD extended its gains for the third consecutive session, reaching its highest level since June 18, as the US dollar came under pressure. Besides the weakness of the greenback, the ADA/USD pair was also higher on board, as Grayscale Investment acquired Cardano and added it to the Grayscale Digital Large Cap Fund. Grayscale reported that they have sold a proportionate amount of the existing components in the fund, and used the cash to buy Cardano tokens.
After adding Cardano, the total number of cryptos involved in the fund rose to six: Bitcoin, Bitcoin cash, Litecoin, Chainlink and Ethereum. However, at 67.47%, the share of Bitcoin in the fund is largest, followed by Ethereum, with a 25.39% share. While ADA is the most recent addition, it is still the third-largest component within the fund, at a proportion of 4.26% of the portfolio. Next comes BCH, at 1.03%, followed by LTC at 0.99%. Finally, at 0.86%, LINK has the smallest share of the fund.
The news that Grayscale has added Cardano to its fund put additional upward pressure on the ADA/USD. Meanwhile, the crypto was also high because of the weak US dollar. The greenback suffered on Friday, due to dismal unemployment rate data released by the US Labor Department. The data showed that the unemployment rate in June reached 5.9%, against the expected 5.6%, which weighed on the US dollar, ultimately providing support to the rising prices of the ADA/USD.
ADA/USD Daily Technical Levels
Support Resistance
1.423441 1.497074
1.385261 1.532525
1.349809 1.570706
Pivot Point: 1.458893
On the technical front, the ADA/USD pair is trading at the 1.4146 level, facing immediate resistance at 1.4923. Closing of candles below 1.4923 suggests weakness in the investors’ bullish tone. On the lower side, the upward trendline supports the ADA/USD pair at the 1.3935 level. The 50 periods EMA is still supporting a buying trend at the 1.4001 level. In case of a bullish crossover at 1.4923, the ADA/USD could go after the next resistance area of 1.5500 and 1.6332. The leading indicators, like the MACD and the
RSI, support a selling bias in the ADA coin today. Let’s keep an eye on the 1.4588 level today, to stay bearish below and bullish above that level. Good luck!
Arslan Butt
Index & Commodity Analyst
Arslan Butt serves as the Lead Commodities and Indices Analyst, bringing a wealth of expertise to the field. With an MBA in Behavioral Finance and active progress towards a Ph.D., Arslan possesses a deep understanding of market dynamics.His professional journey includes a significant role as a senior analyst at a leading brokerage firm, complementing his extensive experience as a market analyst and day trader. Adept in educating others, Arslan has a commendable track record as an instructor and public speaker.His incisive analyses, particularly within the realms of cryptocurrency and forex markets, are showcased across esteemed financial publications such as ForexCrunch, InsideBitcoins, and EconomyWatch, solidifying his reputation in the financial community.
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