Cardano News- Cardano Price: ADA’s 36% Recovery and What’s Driving the Bullish Momentum
Cardano News– Cardano (ADA) has shown a notable rebound in recent days, rising by 36% since its price fell to $0.83 on December 30, 2024. At the time of writing, ADA is trading at $1.30, reflecting a 5% increase in the last 24 hours. This price movement positions ADA above its 50-day simple moving average (SMA), suggesting the potential for further upward momentum. Let’s delve into the factors that have contributed to this impressive recovery.
ADA Price Moves in Tandem with Bitcoin and Ethereum
The positive price action for ADA is part of a broader trend across the cryptocurrency market, with other major digital assets, including Bitcoin (BTC) and Ethereum (ETH), experiencing notable gains. Bitcoin, the largest cryptocurrency by market capitalization, has seen an 8% increase over the past week, reaching a three-week high of $102,760 on January 7, 2025. Ethereum has followed suit, rising more than 0.5% in the last 24 hours to trade above $3,660.
Other top cryptocurrencies, such as Binance Coin (BNB), XRP, and Dogecoin (DOGE), have also posted substantial gains, further fueling the overall bullish sentiment in the market. As a result, the total market capitalization of all cryptocurrencies has grown by 2% in the past 24 hours and 10% year-to-date, reaching $3.58 trillion at the time of publication.
This market-wide rally is likely fueled by positive sentiment, possibly influenced by broader economic factors or political developments. A key event that has captured the attention of the crypto community is the upcoming inauguration of Donald Trump on January 20, 2025. Speculation around Trump’s presidency has led to increasing optimism that his administration could usher in a more favorable regulatory environment for cryptocurrencies, including ADA.
Michael Saylor, a well-known Bitcoin advocate, has suggested that under Trump’s leadership, there could be an end to what he calls the “war on crypto” and that more pro-business and pro-crypto policies may emerge.
DeFi Growth on the Cardano Network
One of the key drivers behind ADA’s recent price surge is the significant recovery in Cardano’s decentralized finance (DeFi) ecosystem. According to data from DefiLlama, Cardano’s total value locked (TVL) in DeFi protocols has increased by 36.8% in just seven days, from $423 million to $579 million. This surge was driven by a series of DeFi projects such as Liqwid (lending), Minswap (DEX), and Indigo (lending), which saw increases in locked value by 35%, 27%, and 29%, respectively.
The growth in TVL is a strong indicator of investor confidence in the Cardano network. It signals that more capital is being deployed in DeFi protocols on Cardano, which is likely contributing to the bullish outlook for ADA.
Increased Open Interest and Onchain Activity
In addition to the growth in Cardano’s DeFi ecosystem, there are other metrics pointing to increased market activity. Cardano’s open interest (OI) has risen by 10.75% over the past day, reaching $1.43 billion on January 7, 2025. This surpasses the $1.18 billion mark that was reached on December 9, 2024. The increase in OI coincides with ADA’s price growth, suggesting that futures traders are showing sustained interest in the asset.
Onchain activity is also on the rise, with daily transactions increasing, as noted by data from Artemis. Additionally, Cardano’s ongoing developments, such as progress on the Lace Wallet, Midnight, and CIP-1694 projects, continue to fuel investor optimism.
ADA’s V-Shaped Recovery: A Bullish Chart Pattern
The price action of ADA since December 2024 has formed a V-shaped recovery pattern on its daily chart. A V-shaped recovery is a bullish technical formation that occurs when an asset experiences a sharp drop followed by a rapid rebound. In ADA’s case, the price has moved up significantly from a low of $0.83 to its current levels above $1.30.
ADA’s price is currently above a key demand zone between $1.00 and $1.12, where the 50-day SMA is situated. This position suggests that if buying pressure continues at these levels, ADA could rise above the $1.23 neckline, completing the V-shaped pattern. If this occurs, the next resistance level to watch would be the $1.33 mark, which was reached on December 3, 2024, representing a potential 17% increase from the current price.
Disclaimer: This article is for informational purposes only and does not constitute investment advice. Cryptocurrencies and stocks, particularly in micro-cap companies, are subject to significant volatility and risk. Please conduct thorough research before making any investment decisions.
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