ADA Price at a Critical Juncture: What Lies Ahead?
As ADA price hovers at a crucial crossroads, the upcoming Chang hard fork and fragile support levels make its future direction uncertain. While on-chain metrics suggest a potential bullish tilt, trader behavior analysis reveals a more bearish outlook. Can Cardano price navigate through the mixed market sentiment and emerge unscathed?
On-Chain Metrics Hint at a Potential ADA Rally
Recent data from Santiment highlights that Cardano’s Network Value to Transactions (NVT) ratio has reached a 7-month high, even as the price has declined over the past five days. Typically, a rising NVT ratio alongside a falling price is considered a bearish indicator for the cryptocurrency.
However, data from IntoTheBlock shows a notable increase in large holder netflow between August 25 and 28, coinciding with the price drop. This suggests that large investors, often referred to as “whales,” may be accumulating ADA despite the downturn.
This accumulation by large holders could indicate their confidence in ADA’s long-term prospects, even if short-term price action remains negative. The rise in the NVT ratio, paired with this buying activity, could suggest that investors are valuing Cardano at a premium, possibly due to speculative interest or future growth potential.
Such accumulation could provide a buffer for the price, as increased demand from these large holders might eventually stabilize or even drive the price upward, as seen in recent Cardano technical analysis.
ADA Technical Analysis: Support or Springboard?
Cardano’s price has struggled to maintain its position above the 50-day exponential moving average (EMA), eventually succumbing to intense selling pressure. The drop below the 50 EMA (represented by the green line) underscores a prevailing bearish momentum.
ADA found temporary support around $0.3550, where whales appear to be establishing a buy wall. Candlestick patterns at this level exhibit small-bodied candles with wicks on both ends, signaling market indecision.
However, Coinglass’s 7-day Liquidation Map reveals a formidable sell wall between $0.372 and $0.4. Surpassing this level would require significant buying momentum.
On the other hand, there is only a thin layer of buy orders between $0.348 and $0.312. If these orders are exhausted, ADA could experience a sharp decline, potentially dropping below the $0.3 mark.
Could Cardano Price Plunge 10%?
ADA’s overall trend remains bearish unless it can break above the previous high of $0.4. While positive investor sentiment could provide some support, profit-driven futures traders, who do not hold a direct stake in the asset but rather trade on leverage, wield considerable influence. The successful execution of the Chang hard fork could be pivotal in determining ADA’s next direction.
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