Cardano’s relief rally is good news, but here’s why it might not last!

ambcryptoPublished on 2026-02-08Last updated on 2026-02-08

Abstract

Cardano (ADA) recently saw a relief rally following the announcement that the Chicago Mercantile Exchange (CME) will support ADA futures, alongside Chainlink and Stellar. This news came during a broader crypto market downturn, with Bitcoin down 30% and ADA losing 34% since mid-January. Despite the rally, the long-term trend remains bearish, with key support levels at $0.246 and a critical demand zone between $0.22-$0.27. A short-term bounce may test the $0.287 resistance, but the overall outlook suggests a resumption of the downtrend. Traders are advised to consider short positions near $0.287, targeting $0.22, with a stop-loss above $0.305. Long-term investors are cautioned against rushing to buy, as market bottoms can take time to form. A potential liquidity hunt beyond $0.30 is possible if Bitcoin surges, but any rally is expected to cap at the $0.33-$0.35 supply zone.

Cardano [ADA] was in the news recently when it was reported that the Chicago Mercantile Exchange (CME) will support ADA Futures products starting Monday, 09 February. Alongside Cardano, Chainlink [LINK], and Stellar [XLM] would also be part of the CME’s crypto products.

The news came at a time when the crypto market was in turmoil. In fact, Bitcoin [BTC] has shed nearly 30% since 15 January, while Cardano has posted losses of 34% since then.

The bulls managed to defend the major support level at $0.267, for now. Can the CME news sustain this bounce?

Long-term trend does not favor Cardano buyers

The weekly structure was firmly bearish, and has been since October. The loss of the $0.53 support zone, which had been important in the first half of 2025, was a huge blow. At the time of writing, another key support at $0.246 had been tested.

A recent AMBCrypto report had noted that the $0.22-$0.27 area has served as a long-term Cardano demand zone since late 2022. The weekly timeframe saw a wick to $0.22 in the first week of June 2023, marking the lows bulls do not want to see invalidated.

Forecasting the next play – Will the short-term bounce continue or fizzle out?

The bullish divergence between the RSI and the price has nearly finished playing out. The 78.6% retracement level at $0.287 is likely to be tested briefly before ADA resumes its longer-term downtrend.

Traders’ call to action – Sell?

It is feasible to go short upon a retest of $0.287, targeting $0.22, with invalidation above the local high at $0.305. For long-term investors, there is no hurry to buy at the market bottom. Especially since it can take weeks and months to form.

Traders should be aware of the possibility of a liquidity hunt beyond $0.3, especially if Bitcoin climbs past $74k to push towards $80k. In this scenario, the $0.33-$0.35 supply zone should be the ceiling of the rally.

Final Thoughts

  • Cardano has a long-term bearish bias, and the short-term bullish momentum divergence has nearly finished playing out.
  • Fibonacci retracement levels presented a short trade setup targeting the $0.22 lows.

Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion

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Related Questions

QWhat recent news about Cardano (ADA) was mentioned in the article?

AThe Chicago Mercantile Exchange (CME) will support ADA Futures products starting Monday, 09 February, alongside Chainlink (LINK) and Stellar (XLM).

QAccording to the article, what is the major support level that the Cardano bulls managed to defend?

AThe major support level that the bulls managed to defend is $0.267.

QWhat is the suggested trading strategy for Cardano based on the Fibonacci retracement level mentioned?

AThe suggested strategy is to go short (sell) upon a retest of the 78.6% retracement level at $0.287, targeting the $0.22 lows, with invalidation above the local high at $0.305.

QWhat is the long-term trend for Cardano as described in the article?

AThe long-term trend for Cardano is firmly bearish and has been since October, with the loss of the key $0.53 support zone being a significant blow.

QWhat is the potential upside scenario for ADA if Bitcoin's price climbs significantly, according to the article?

AIf Bitcoin climbs past $74k towards $80k, it could trigger a liquidity hunt beyond $0.3 for ADA, with the $0.33-$0.35 supply zone acting as the ceiling for such a rally.

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