Cardano gained 21% over seven days and 7% in 24 hours, but technical signals show momentum weakening despite the rally. The asset now faces a potential 9% trading range between $0.39 and $0.43 as trend strength and cooling momentum create conflicting market conditions.

What Happened: Rally Momentum

Cardano continues trading within a rising trend structure on the 12-hour chart, with the 20-period exponential moving average closing in on the 50-period exponential moving average.

This setup typically signals strengthening momentum when shorter-term exponential moving averages cross above longer-term ones.

However, between Dec. 9 and Jan. 6, Cardano's price trended lower while the Relative Strength Index trended higher.

This hidden bearish divergence indicates slowing momentum rather than trend reversal, though a candle closing below $0.43 would confirm a lower-high price formation and expand pullback risk.

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Why It Matters: Range Formation

The $0.39 level acts as near-term support required to maintain the bullish structure. A break above $0.43 would invalidate the bearish divergence and allow momentum to rebuild, potentially targeting $0.48 and $0.60 if strength accelerates.

Until one level breaks, data points to a range between $0.39 and $0.43, representing a 9% trading box.

The trend remains bullish and holders are not selling, but momentum needs time to reset before the next directional move.

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