Cardano (ADA) has lost 4.04% of its price value in the last seven days as it continues to experience volatility in the market. The coin has not been able to find stability above $0.80 for each of its attempts to breach the resistance level.
Bollinger Bands point to imminent volatility spike
However, Cardano’s key indicator might offer hope for the coin, signaling the possibility of recovery.
Notably, the Bollinger Bands are teasing the possibility of ADA claiming new heights in the crypto market. The current setup shows that the Bollinger bands are narrowing in on price, indicating that a potential spike in price could occur.
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For clarity, this technical indicator helps market participants measure the market’s volatility. When it contracts, it signals reduced volatility, which usually precedes a significant price movement.
The upper Bollinger Band is $0.8544 while the lower band is $0.6257. This shows a narrowing of the bands, and the possibility of a surge to the $1 mark is high.
As of this writing, ADA was changing hands at $0.7630, representing a 2.63% increase in the last 24 hours. With Cardano’s price in the neutral range on the bands, the coin could swing in either direction, depending on ecosystem factors.
Community momentum will be key to Cardano's trajectory
As Charles Hoskinson recently highlighted, all crypto projects need community support for growth. Currently, Cardano requires investors to rekindle interest in ADA.
The asset's trading volume dropped by 26.30% to $864.37 million. The dip followed a price drop, which saw ADA plunge to a low of $0.7373 in earlier trading.
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Cardano’s quick recovery to trade above $0.75 signals ADA’s resilience. Hence, if ADA can break above $0.8544 with strong volume support, it could target $0.95 or $1.
However, if the community does not intensify its trading activity and ADA fails to hold at this level, the price may drop considerably.
