As an analyst with over two decades of experience in the crypto market, I have seen countless instances where market sentiment and technical analysis seemed to contradict each other, only for the unexpected to happen. The current state of ADA is no exception.
The price of ADA finds itself at a critical juncture, as the Chang hard fork approaches and a narrow band of support seems to be keeping it afloat. However, foretelling its future direction is challenging. While on-chain indicators suggest a potentially positive outlook, the behavior of traders reveals a bearish stance towards ADA. Can this cryptocurrency weather the storm of conflicting market sentiments?
Onchain Metrics Reveal ADA Price Potential Rally
According to Santiment’s data, the Cardano Network Value to Transactions (NVT) ratio reached its highest point in seven months. However, over the past five days, the price has been falling. When the NVT ratio increases while the price decreases, it usually suggests a bearish trend for the cryptocurrency asset.
However, IntoTheBlock data shows large holder netflow increased from August 25 to 28 as the price dropped, which indicates that large investors or “whales” may be accumulating the asset despite the falling price.
As an analyst, I’ve observed that large-scale purchases can indicate a strong belief among holders in the asset’s long-term prospects, regardless of any short-term price fluctuations. Moreover, a surge in the NVT ratio might suggest optimistic investor sentiment, implying they are valuing Cardano at a higher price point, potentially due to speculative excitement or anticipation for future growth.
This accumulation may have provided a level of price support, as the increased demand from large holders eventually stabilizes or even pushes the price up, as seen on the Cardano technical analysis.
ADA Technical Analysis: Temporary Support or Launch Pad?
Despite the Cardano price’s effort to remain above its 50-day exponential moving average, the intense selling activity prevailed, causing the price to fall beneath this average (represented by the green line). This downward movement below the 50 EMA implies that a bearish trend is currently in control.
The cost of ADA stabilized near approximately $0.3550, which appears to be an area where many large investors are accumulating, or creating a “buy wall.” At this level, the analysis of candlestick patterns suggests uncertainty in the market, as small-sized candles with tails on both ends indicate indecision, possibly signaling a pause in price movement.
As a crypto investor, I’ve noticed an intriguing trend from the Coinglass 7-day Liquidation Map – there seems to be a significant resistance level between $0.372 and $0.4. This implies that breaking through this barrier requires substantial buying power, suggesting a potential challenge ahead for any upward price movement.
Conversely, there is a thin slice of sell buy order between $0.348 and $0.312, which, if eliminated, may result in an ADA price free fall to sub $0.3 price.
Will Cardano Price Crash 10%?
1. In general, the price of ADA is likely to continue falling unless it surpasses its previous high of $0.4. While optimistic investor feelings can momentarily boost the cost, professional futures traders holding leverage have greater influence in the long run as they don’t own the actual asset. The successful implementation of the Chang hard fork for Cardano has a significant role in determining its future direction.
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2024-08-30 06:12