Cardano has just seen a surge beyond the $0.85 mark, potentially confirming a bullish breakout forming in the asset’s 4-hour price chart.
Wedges form whenever an asset travels between two converging trendlines. When the lines are sloped upward, the formation is known as a Rising Wedge. Similarly, price action to the downside creates a Falling Wedge.
Generally, Wedges are considered more likely to lead to reversals. A Falling Wedge may see the price eventually break past the upper line, while a Rising Wedge could end with a breakdown of support. Cardano has recently been moving inside a channel similar to a Falling Wedge. Below is the chart shared by Martinez, showcasing the formation.
At the time the analyst posted the graph, Cardano was beginning to show signs of a surge beyond the resistance line of this Falling Wedge. The breakout attempt came as the asset was closing in on the convergence point of the trendlines.
Near the apex of such patterns, price action occurs inside a tight range, so breakouts can become more likely. This could be what was developing for ADA at the time.
Martinez noted in the post that the cryptocurrency must break past $0.84 to confirm the bullish breakout. Since then, ADA has surged further, reaching the $0.85 level. Thus, it’s possible that a sustainable break could really be kicking off for the coin, at least if the Falling Wedge is anything to go by.
As displayed in the chart, Solana has been trading inside this Rising Wedge for a few months now and is slowly inching toward the end of it. If the pattern is going to be a reversal one, then a bearish breakout may be coming for SOL.
At the time of writing, Cardano is floating around $0.851, up almost 4% over the last seven days.
