As the cryptocurrency market shifts into a bullish phase, Cardano (ADA) is riding the wave with impressive gains. Over the last 24 hours, ADA surged by more than 6%, bringing its price to $0.3864. This surge not only highlights the resilience of Cardano but also signals a potential breakout from a crucial resistance level, suggesting that ADA could be gearing up for a push toward $1.
The Latest Breakout
The latest momentum in Cardano’s price action can be attributed to a significant bullish pattern that has been forming since December 2023. As highlighted by crypto analyst World Of Charts, ADA recently broke above a bullish falling wedge pattern. This pattern had seen the token consolidating, but with this breakout, the stage is set for ADA to capitalize on its upward trajectory.
Interestingly, this price increase has resulted in over 1.4 million ADA addresses being in profit, which accounts for more than 31% of all Cardano addresses. This growing number of profitable addresses indicates an expanding base of support for the token, potentially attracting even more investors as market sentiment remains positive.
Key Indicators for ADA’s Price Movement
Recent on-chain data analyzed by AMBCrypto reveals that the surge in ADA’s price was accompanied by a notable increase in trading volume, a key metric often correlated with bullish rallies. According to Santiment’s data, the increased trading volume, alongside a rising MVRV (Market Value to Realized Value) ratio, signals a healthy bullish trend. Additionally, whale activity—transactions involving large holders—has also remained robust, indicating confidence among significant market players.
However, not all indicators paint a rosy picture. Data from Coinglass has shown a decrease in Cardano’s long/short ratio, suggesting that there are currently more short positions in the market than long ones. This shift raises some concerns about potential profit-taking, particularly if the bullish momentum falters.
Technical Analysis – What Lies Ahead
Examining the daily chart for Cardano reveals that the token is approaching another resistance level. The MACD (Moving Average Convergence Divergence) indicator currently shows bullish momentum, which may set the stage for further gains if ADA can break through this resistance. Should this breakout occur, analysts anticipate an initial target around $0.45, a critical milestone before ADA sets its sights firmly on the $1 mark.
However, traders should remain cautious. A recent downtick in the Relative Strength Index (RSI) after a sharp spike indicates a possible price correction could be on the horizon. If the bullish rally loses steam, it wouldn’t be surprising to see ADA retreat back toward the $0.30 level.
As Cardano continues to gain traction in a bullish market, its recent breakout from crucial resistance levels showcases its potential for further growth. With a significant number of addresses now in profit and strong trading volume, ADA appears well-positioned for a potential ascent towards $1. However, market participants should remain vigilant, keeping an eye on key technical indicators and market sentiment to navigate the possible price fluctuations in the coming days. With the right moves, ADA could be on the verge of a significant milestone in its ongoing journey in the cryptocurrency landscape.
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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