Cardano (ADA) price’s recent performance has sparked optimism among investors, with the cryptocurrency surging by 83% in the past week.
Surging to around $0.65, ADA has showed signs of bullish momentum as it approaches the key $1 price level.
This price target has become a focal point for analysts, as ADA’s historical performance in November and its recent surge in on-chain activity have contributed to rising market interest.
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However, as of press time ADA bull rally had worn off with the price exchnaging hands at $0.532, a 10% decine from the intra-day high.
ADA Rally Surge Fueled by On-Chain Activity and Whale Transactions
Within the last 24 hours, ADA has processed more than $14 billion in value from whale accounts, which is a clear sign of institutional and large capital players coming into the network.
On-chain analysis of these high volume transactions indicates further upside as whale activity is often an indicator of future market direction.
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This has been complimented by an increase in ADA’s transaction volume which rose by 251% in the recent past indicating that the big investors are becoming more confident.
In particular, November has always been favorable for ADA since the average price increase for the past seven years is 50.3%.
Keeping in mind this seasonal movement in the market, some of the traders are confident that ADA can potentially reclaim or go even beyond the $1 if the situation remains the same.
The community outlook is still optimistic and a recent poll predicted that 90% of Cardano holders were bullish on the cryptocurrency’s price.
Cardano Technical Indicators Show Mixed Signals Amid Uptrend
ADA’s technical indicators present a mixed picture. The Moving Average Convergence Divergence (MACD) indicator currently reflects a bearish sentiment, as the MACD line is below the signal line and the histogram remains in negative territory.
However, ADX is at 47.44 indicating presence of strong trend. A high ADX value suggests that the current trend is most likely strong and that if the price continues to rise then this could be the beginning of an uptrend.
The Relative Strength Index (RSI) is at 47.50, which means that the market is slightly neutral to bearish given that the index is only slightly below the 50-line.
However, the Money Flow Index (MFI) is at 32.94 at the moment, close to crossing the oversold zone and these low levels might pull in more buyers if the price holds near the current support levels.
There is also much attention to the emergence of a ‘golden cross’ of the 50-day moving average over the 200-day moving average, which is a positive signal.
Community Sentiment and Potential for a Rebound
Community plays a critical role in the price prediction of Cardano. The network has maintained a consistent level of developmental work with several protocol enhancements dedicated to addressing concerns such as scalability.
The founder of the ADA, Charles Hoskinson, has suggested that the project may become more involved in discussions about policy in the United States in the light of recent political changes which has boosted morale among ADA supporters.
Concurrently, there has also been rumors of Cardano partnering with Ripple, which has fueled the hope of the ADA community.
Cardano Path to $1 and Challenges Ahead
If ADA is to trade above $1, it must continue the upward trend while penetrating the resistance areas identified at $0.657.
The recent fall in the value of most cryptocurrencies, with Bitcoin dropping from $90 000 to $86 000 has also impacted Cardano.
However, given these wider losses, ADA’s strength may be useful as it nears key resistance levels. Crypto enthusiasts, including Ben Armstrong, aka BitBoy Crypto, have criticized the project for Cardano’s low user activity and institutional investments as compared to other Layer 1 chains.
Armstrong has before now referred to ADA as a “dead” asset and expressed doubt over the possibility of it being attractive to institutional investors.
Based on the recent performance of ADA, it can still be possible for ADA to have short-term gains especially if the on-chain analytics and the community are favorable.
