Cardano (ADA) has shaken off its April slumber, experiencing a remarkable 15% price surge in the first few days of May. This bullish momentum comes after a challenging April marked by a decline in the Cardano DeFi ecosystem and a 35% price drop.
So, what’s driving this sudden resurgence? On-chain data suggests that swing traders, capitalizing on the broader crypto market recovery, are the primary force behind ADA’s recent climb.
While the Cardano DeFi sector remains sluggish, with investors withdrawing over 36 million ADA last month, the current market depth chart reveals a significant shift in control. Exchange order books show a dominance of buy orders, with a staggering 251 million ADA currently listed for purchase at an average price of $0.47.
This imbalance, with only 230 million ADA listed for sale, creates a scenario of excess demand. In simpler terms, buyers are outnumbering sellers, potentially pushing the price further upwards.
This bullish sentiment is further supported by IntoTheBlock’s GIOM data, highlighting a potential hurdle at $0.50. Here, 181,620 addresses hold 2.26 billion ADA purchased at an average price of $0.49. If these early investors decide to take profits, ADA might face resistance in reclaiming the $0.50 mark.
However, if the bulls can overcome this obstacle, $0.60 appears to be the next target. While achieving this goal won’t be a walk in the park, the current market dynamics suggest a strong possibility of further upside for Cardano in the coming days.
Also Read: Cardano Whales Make a Splash: $13 Billion Daily Transactions Signal Renewed Interest
With a potential $20 million excess demand hovering in the market, Cardano bulls have a significant advantage. Should they maintain their momentum, a return to the $0.60 milestone seems plausible. However, the $0.50 resistance zone presents a potential challenge that needs to be overcome for a sustained upward trajectory.
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