Cardano dropped 19% yesterday due to Bitcoin’s ETF denial report. The price of ADA/USDT dropped below the major support level of 0.5904 and broke the bullish trendline. The price is likely to drop further to 0.3725 support level.

The 0.5904 support level will now act as a strong resistance level and the price broke the bullish trendline around the same price. I am considering the 0.5904 resistance level for sell entry and my target for this trade is the 0.3725 support level.

Another confirmation for short entry around the same price is the 0.50 Fibonacci retracement level. The price is likely to make a correction after the drop and will retrace to the 0.5904 resistance level before the drop.

Fundamentally, the recent 19% drop was mainly driven by a report claiming that the SEC “will reject” the spot Bitcoin ETF.

If that happens the overall crypto market could drop further, however, if that’s untrue then the price is likely to follow the price action. Moreover, the NFP data will also be published in USD tomorrow which could also impact the price significantly.

• The price of  ADA/USDT is likely to drop further after it dropped below the bullish trendline yesterday.
•  The price is likely to drop to the 0.3725 support level in the coming days
• Multiple take-profit levels have been added to secure profit along the way.
• The risk-to-reward ratio on this trade is 1:3.5.
• The entry and stoploss prices have been placed at secure levels with the least probability of getting hit.
• Good luck!

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