Cardano (ADA) sees a modest price increase, but trading volume and market capitalization suggest a lack of sustained interest. Despite signs of potential recovery, the overall market momentum remains uncertain.
Cardano ( ADA ) experienced a slight 2% gain in the past 24 hours, reaching a price of 0.996 at press time. Despite this positive movement, trading volumes have declined by 40% to $1.4 billion, indicating reduced market interest. Furthermore, Cardano 's market capitalization has dropped by 14% in less than a week, settling at $35 billion. This suggests a lack of substantial buying pressure and a need for increased trading volume to fuel a sustained rally.
Analyzing ADA's weekly chart reveals the potential for a rally to $2.47 if it follows historical price patterns. After completing an ascending parallel channel late last year, ADA entered a consolidation phase, encountering resistance at $1.09, preventing a decisive upward breakout. This current trend echoes ADA's performance in 2021, where a sharp rise was followed by a cooling-off period. Following weeks of consolidation, ADA surged, registering an over 200% gain within two weeks to reach $2.47.The Relative Strength Index (RSI) at 62 indicates that ADA is cooling off after reaching an overbought condition. However, sellers haven't yet overpowered buyers, suggesting some trader confidence that the rally could resume. Additionally, ADA's Moving Average Convergence Divergence (MACD) shows that despite reduced buying volumes, the overall momentum remains bullish. Recent activity on the Cardano network has been on the rise, with an increase in the number of addresses. Data from Santiment shows that daily active addresses reached 50,828 earlier this week, potentially indicating growing network usage or a spike in trading activity. Conversely, data from Coinglass revealed a drop in Cardano's Total Value Locked (TVL) to $518 million. A surge in DeFi activity is crucial to support ADA's long-term upward trend. Notably, Coinglass also reported a surge in ADA short positions, with the coin's Long/Short Ratio dropping to 0.824, its lowest level in over a month. However, this influx of short positions could potentially contribute to a recovery if a short squeeze forces traders to buy to close their positions.
CARDANO ADA CRYPTOCURRENCY MARKET ANALYSIS PRICE TRENDS TRADING VOLUME DEFI SHORT POSITIONS
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