- Cardano and Solana have both dropped by more than 28% over the past week.
- Both Layer 1 tokens show buy signals on their 12-hour charts.
- If validated, ADA could rebound to $ 0.55 and SOL to $ 36.
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Layer 1 tokens Cardano and Solana appear to have reached oversold territory after taking a nosedive in the last seven days. It remains to be seen whether these altcoins can gain the strength to bounce off crucial support.
Cardano and Solana Show Buy Signals:
Cardano and Solana appear to be gearing up for bullish impulses after incurring significant losses over the past week.
The seventh-largest cryptocurrency by market cap has dropped by more than 28% since Jun. 8. ADA recently hit a low of $ 0.44 and trades at around $ 0.47 at the time of writing. Interestingly, a buy signal formed on Cardano’s 12-hour chart, hinting at a potential rebound.
The Tom DeMark (TD) Sequential indicator recently formed a red nine candlestick, which is considered a bullish formation. The technical pattern indicates a one-to-four candlestick upswing that could help Cardano regain lost ground. A spike in buying pressure around the current price levels could trigger an upswing to $ 0.55 or even $ 0.68.
Still, Cardano must hold above the $ 0.44 support level to have a chance of validating the optimistic outlook. Failing to do so could lead to a spike in sell orders that sends ADA to $ 0.37.
Solana has also suffered from the cryptocurrency market slump. It took a 38% hit over the past week to reach a recent low of $ 25.80. Although the incurred losses are significant, the RSI shows a bullish divergence, anticipating that SOL can rebound.
The TD setup adds credence to the optimistic outlook after presenting a buy signal on SOL’s 12-hour chart. It developed a red nine candlestick, which could lead to a one-to-four candlestick upswing. But to do so, Solana needs to close above $ 31.
Slicing through such an important resistance level could give SOL the strength to surge toward $ 36 or even $ 40. Nonetheless, Solana must hold above $ 26 because dipping below this support level can lead to a downswing to $ 21.
It is worth noting that the US Federal Reserve is widely expected to raise interest rates later today. These events tend to generate a lot of volatility in the global financial markets, including the cryptocurrency market, so caution is advised.
Disclosure: At the time of writing, the author of this piece owned BTC and ETH.
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