Cardano ADA Price Forecast: Can ADA Reach $3 in 2023?
• ADA, the cryptocurrency that powers Cardano’s blockchain protocol, is under selling pressure on Friday in tandem with broader crypto markets.
• The latest US inflation report has triggered fears that the Fed might have to raise interest rates higher for longer and this has weighed on sentiment.
• Although ADA may continue to appreciate this year if cryptocurrency markets recover, reaching $3.00 would require a series of rate cuts from the Fed.
Cardano Price Forecast
ADA Loses Grip on $0.38 Level
ADA/USD was last changing hands in the $0.37s, down around 1.5% on the day, with crypto weighed by downside in US stocks and upside in the US dollar and yields in the wake of a hotter-than-expected US inflation report.
Impact of US Inflation Report
The PCE Price Index report for January was released earlier on Friday and revealed a larger-than-expected jump in MoM core inflation to 0.6% from 0.4% in December, which was also revised higher from the previous estimate of 0.3%. The latest data has triggered fears that the Fed might have to raise interest rates higher for longer, hence the risk-off reaction in crypto and traditional asset classes.
Technical Crossroads
ADA’s latest decline means it is now over 10% below earlier monthly highs in the $0.42s and is back under its 200-Day Moving Average at $0.3815. Cardano is now at a technical crossroads and today’s close will be key.
Can Cardano Reach $3 This Year?
The Cardano ecosystem will almost certainly continue to grow in 2023, thanks to its large and dedicated community of supporters and developers who continue to launch useful new protocols on the blockchain, including most recently the overcollaterized algorithmic stablecoin Djed.
Assuming that cryptocurrency markets continue their gradual recovery from last year’s highly oversold levels, ADA can certainly continue to appreciate.
However, with US inflation remaining sticky at elevated levels and the economy still humming along nicely,the outlook for a significant easing of financial conditions isn’t great.
In other words, 2023 will probably see at least three more Fed rate hikes ,and might not see any rate cuts beforethe end of theyear .For crypto exuberance toreally come surging back ,a series of ratecutsis probably goingto beneeded .Inthat sense ,ADAhitting$3 .00 (near10x gainsfrom currentlevels)
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