Analyst Says Cardano May Retest Broadening Wedge Channel Low Before Targeting $2.40

Analyst highlights a potential Cardano pullback to key support within a broadening channel before a continuation of the upward movement.

Notably,bitcoin downfall Cardano is trading at $0.6042 today, reflecting a minor 0.32% increase on the day, but a 5.56% decline this week. Meanwhile, chart patterns and indicators shared by market technician Bitcoinsensus point to an upcoming breakout. 

A recent technical analysis by Bitcoinsensus highlights a potential bullish breakout for Cardano. The outlook centers on a long-term ascending broadening wedge pattern. According to the analyst, the price action within this formation continues to reflect strong structural support, even after multiple retracements. Key rallies and pullbacks have consistently aligned with the wedge’s boundaries, building a case for a larger move in the near term.

First and Second Rallies Define the Wedge Pattern

The structure first gained significance after ADA’s price bounced from the wedge’s lower boundary. Before that, two rejections occurred at the upper trendline. The first rejection came near $0.41 in early February 2023. A second rejection followed at approximately $0.45 on April 16, 2023. Following those tops, Cardano retraced, but the lower boundary offered a reliable defense.

In mid-October 2023, ADA reached a low of around $0.24. Then again, in the latter part of November of that year, the price touched $0.35. In both cases, the lower trendline remained intact, preventing further declines. After this double bottom, a notable 200% price surge took ADA to around $0.66 by mid-December 2023.

Subsequently, ADA formed another top at $0.77 in March 2024. However, the pattern remained intact as the price reversed again, dropping to around $0.27. The analyst notes that this level marked another successful test of the wedge’s lower limit. This move paved the way for the second major rally within the formation.

300% Advance Confirms Structural Strength

The following surge drove Cardano up by 300%, culminating in a price of $1.32 on December 7, 2024 amid the latest market-wide rally from Q4 2024 to Q1 2025. This movement occurred directly after the third major test of the lower wedge boundary. The consistent reaction to these technical zones supports the broader pattern’s validity.

Throughout this period, the analyst maintained focus on how each rally and retracement stayed within the wedge’s defined trendlines. These repeated moves underscored the relevance of the pattern in guiding price action. Additionally, the sequence of rallies appeared to gain in size, from +200% to +300%, strengthening the wedge’s bullish bias, according to the data reviewed.

Next Support Retest and Potential Upside Target

Following the second rally’s peak at $1.32, Cardano faced a pullback, which has persisted until now. The analysis expects the pullback to continue until Cardano drops to the lower wedge boundary near $0.38. This expected drop would mark yet another support test, consistent with previous price behavior inside the pattern.

After that potential retest, the projection points to a long-term upside target of $2.40. This represents a 550% increase from the estimated support level.

Further Signs of Bullish Potential

Elsewhere, analytical account Rose Premium Signals previously identified a potential triple-bottom formation on Cardano’s chart, signaling a possible bullish reversal if key support holds. 

In addition, a falling wedge pattern has emerged, with price failing to breach the upper trendline at $1.30 on December 2 and $1.17 on March 3. If ADA breaks above the wedge, key upside targets include $1.0057, $1.2114, and $1.4329.