Cardano'south native token, ADA, ignored a serious price crash warning to rally to a new all-fourth dimension high.

The ADA/USD exchange charge per unit reached $two.56 for the first time on Fri, following a 154.54% toll boom that started on July 20. In doing then, the pair also ignored veteran trader Peter Brandt's 60%–90% toll crash warning, which was based on a classic bearish pattern chosen the head and shoulders.

But a flurry of bullish fundamentals assisted Cardano to ignore surly technical setups.

Capital rotation

At showtime, ADA/USD'south upside rally in the early days appeared largely in the wake of a similar blast across the cryptocurrency marketplace, led by the euphoria surrounding its rival's, Ethereum, major software upgrade and fresh endorsements for Bitcoin from Tesla'due south Elon Musk and Twitter's Jack Dorsey.

ADA prices also tailed Bitcoin (BTC), which has recently rallied in a higher place $48,000. But the Cardano token started outperforming Bitcoin after Tuesday as the latter turned choppy around the United States Federal Reserve's tapering decision, every bit Cointelegraph covered here.

ADA toll trends (black and white) vs. BTC price trends (red and blue). Source: TradingView

In item, the ADA/USD exchange charge per unit surged 36.81% from its Midweek low of $1.87 versus BTC/USD'south 7.91% rally in the same catamenia.

Other acme altcoins also posted better profits than Bitcoin, hinting that traders just rotated upper-case letter out of the flagship crypto's market on overvaluation risks.

Altcoins 24-60 minutes adjusted functioning against the U.Due south. dollar and Bitcoin. Source: Messari

Smart contracts FOMO

Traders' bids for ADA also surged due to hype surrounding Cardano'southward "Alonzo" upgrade, which is scheduled for mid-September. The update expects to deploy smart contracts functionality onto the Cardano blockchain, a step that the project's supporters say volition brand it a direct rival to Ethereum.

Smart contracts would enable Cardano to integrate more decentralized applications in its ecosystem, peculiarly decentralized finance platforms that enable automated borrowing, lending and trading services.

Technical outlook

Brandt'due south bearish setup appears less likely to exist realized by traders against Cardano'south bullish fundamentals.

The ADA/USD daily nautical chart shows the pair in price discovery. Meanwhile, a Fibonacci retracement graph sketched from the swing high of $two.51 to the swing low of $1.05 spots ADA testing $ii.51 equally its interim resistance level.

Related: Bullish cup and handle pattern sets Cardano (ADA) cost upward for a new ATH

A shut above the said price ceiling puts ADA/USD en route to the next resistance line at 1.618 Fib line near $3.41.

ADA/USD daily chart technical setup. Source: TradingView

Conversely, ADA'south daily relative strength indicator (RSI), at present above 70, has alerted about its acting overvaluation risks. As a result, ADA/USD can undergo a certain caste of correction to neutralize its overbought status, with the adjacent support target sitting nigh 0.786 Fib line (at $ii.twenty).