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Cardano is currently in a "trapped" scenario, according to the Bollinger Bands indicator, with traders now watching the next price move.
Bollinger Bands are volatility bands placed two standard deviations above and below the 20-period (day or week) simple moving average of the price.
The scenario for Cardano on the daily chart is presented with price constricted below the midline, which is the 20-day MA and the lower band of the Bollinger range.
As seen on the daily charts, the Bollinger Bands have narrowed since February as Cardano stayed in sideways trading.
Cardano has consolidated in a broad range between $0.22 and $0.312 since February, as bulls and bears engage in a tussle.
A narrowing band suggests declining volatility, which might be a signal that the market is coiling and preparing energy for the next big move in either direction.
What's next?
At the time of writing, ADA was up 3.44% in the last 24 hours to $0.2633, in line with the broader market recovery. Major tokens snapped back on Tuesday as optimism rippled through risk markets.
Cardano's price recovery is expected to face selling at the 20-day MA, currently at $0.27, with ADA only reaching a high of $0.267 in the early Tuesday session. A price climb past $0.27 and $0.30, which mark the midline and the upper band of the Bollinger range, might signal a potential short-term trend change.
On the other hand, support is expected at $0.24, the lower band of the Bollinger range, which the price has tested a handful of times since March.
Cardano fundamentals stay positive
Yesterday, Cardano announced the release of the Programmable Tokens Platform, a key to unlocking tokenization and further growth of stablecoins on Cardano.
In a key follow-up to its roadmap, the Cardano Foundation continues to facilitate the progress of CIP-0113, a standard to enable token issuers to attach programmable rules to Cardano native assets, allowing tokenized instruments to meet compliance and operational requirements.
A major milestone for interoperability was announced in February through the integration with LayerZero on Cardano.
Dan Burgin
Vladislav Sopov
