Is Cardano’s Vasil hard fork a ‘sell the news’ event?

  • Cardano price is facing an uphill battle against multiple hurdles up to $0.628.
  • A quick recovery above $0.487 will be essential to trigger a move up to $0.550 and subsequent resistance.
  • A daily candlestick close below $0.435 will invalidate the bullish thesis for ADA.

Cardano price looks set to face tremendous selling pressure which could lead to choppy price action. However, the fundamental side of things looks good for ADA given the recent update regarding Vasil’s highly anticipated hard fork.

One more step towards Vasil’s hard fork

As explained in previous articles, this upgrade will take a three-pronged approach to improving the Cardano blockchain: scaling, smart contract capabilities, and block transmission latency. The first major update regarding this upgrade was provided on June 27 when IOHK, the developer team behind Cardano announced the launch of Node 1.35.0.

Stake Pool Operators (SPOs) must upgrade to the latest version of Node to participate in the Vasil hard fork tests that will begin soon. IOHK CTO Romain Pellerin announced,

We have reached 50% stake controlled by 1.35.0 nodes on the #Cardano testnet, 25% more to go

When this number reaches 75%, the Vasil hard fork event can take place on the Cardano testnet. As of June 28, that number currently stands at 53.2%, suggesting that there is still a long way to go.

Cardano’s price in the face of blockages

Cardano price is trying to overcome its immediate hurdle at $0.488, i.e. the 8-day exponential moving average (EMA). ADA has been trading between the 8-day and 34-day EMAs since June 24 and the rest since June 28.

However, the recent rally above the weekly open at $0.484 suggests that the bulls are under control.

The resulting rally is likely to propel Cardano’s price to $0.550, which is just above the 34-day EMA. Overcoming these two blocks will place ADA against the 50-day EMA. This is probably where the upside is capped for the so-called “Ethereum-killer”.

Therefore, the journey for ADA is an uphill battle, although it is likely to continue to rise. However, if the price of Bitcoin starts to recover, it will also improve the chances of Cardano and other altcoins rising in price.

Therefore, a decisive move above $0.550 could push ADA to $0.628, where it is likely to form a local top.

ADA/USDT 1-Day Chart

Although things look optimistic for ADA, it faces headwinds. If Cardano price breaks down and produces a daily candlestick near the $0.435 support level, it will create a lower low and invalidate the bullish thesis.

Such a development could see ADA price plunge another 12% to retest the $0.380 foot.