Cardano [ADA] is back in the spotlight following a notable spike in network activity, even as its price remains largely stagnant. A recent upgrade to the Cardano network earlier this month failed to immediately boost ADA’s price, but the sudden surge in active addresses over the past few days indicates that changes may be starting to resonate with the community.
Cardano’s Active Addresses Spike To Five-Month High
An analysis of Cardano’s daily active addresses reveals a substantial uptick in network engagement. According to data from Santiment, Cardano’s active addresses surged to over 52,000 on 5th September, marking the highest level in over five months. Although the number dipped to around 39,400 the following day, this still represents a significant increase compared to previous months.
By 7th September, active addresses had further declined to approximately 31,600. While the drop might suggest fading momentum, this marks the first time in months that Cardano has experienced such a strong surge in address activity. The spike signals renewed interest in the Cardano ecosystem, potentially a delayed reaction to the recent network upgrade. This increase in network participation could pave the way for greater utility and involvement in the platform as users begin to explore the new improvements.
ADA Approaching a Potential Reversal?
Despite the uptick in network activity, Cardano’s price remains in a general downtrend. However, recent price movements suggest a glimmer of hope. ADA posted a 3.4% increase, closing its last trading session at $0.32. As of this writing, the price has climbed further to $0.33, reflecting an additional 2.7% rise. If this positive momentum continues, it would be the first time in two weeks that ADA has achieved consecutive gains above 2%.
A closer look at Cardano’s Relative Strength Index (RSI) shows that the asset is still below the neutral line, hovering around 46. While not yet in bullish territory, the RSI’s upward movement in the past 24 hours signals improving market sentiment. If ADA continues to gain traction and its RSI climbs closer to the neutral line, it could mark the beginning of a breakout from its current downtrend.
Can Trading Volume Push ADA to New Highs?
While ADA’s price shows signs of recovery, its trading volume remains critical to sustaining any potential breakout. Cardano has maintained a trading volume in the $300 million range, with the highest volume reaching around $340 million. Although this is a decent level of activity, a significant rise in volume is needed for ADA to break out of its current downtrend.
Also Read: Cardano’s ADA Hidden Gem – 6,481% Price Increase in 2021 Proves Its Potential
A convergence of increasing trading volume and rising price action would be crucial to solidifying a new bullish trend. Without a substantial boost in volume, ADA’s recent gains might be short-lived, and the asset could struggle to maintain upward momentum.
Cardano’s recent spike in daily active addresses hints at growing interest within the network, even as its price lingers in a downtrend. While the surge in network activity may be a delayed reaction to the recent upgrade, ADA will need stronger trading volume and sustained price gains to confirm a bullish reversal. As market indicators like RSI and trading volume show signs of improvement, the coming weeks could prove pivotal for Cardano’s future price movements.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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