Cardano (ADA): Key Level Could Trigger 14% Price Surge
Cardano's Critical Juncture: Will Support Hold?
Cardano (ADA) experienced a 12% dip recently, bringing it to a crucial support level. The cryptocurrency now faces a potential make-or-break moment that could determine its short-term trajectory.
At the time of writing, ADA was trading around $0.8565, reflecting a 9% decrease over the past 24 hours. This price drop spurred increased trading activity, evidenced by a 22% surge in trading volume.
Traders Bet Big on ADA Recovery
Data from CoinGlass reveals a strong bullish sentiment among traders. The Binance ADAUSDT Long/Short Ratio sits at 3.99, indicating nearly four times more traders are betting on long positions compared to short positions.
Specifically, 79.96% of accounts are holding long positions, while only 20.04% are short. This suggests a widespread expectation of a price rebound.
Technical Analysis: Trendline as Lifeline
Technical analysis indicates that the current support zone coincides with an ascending trendline that ADA has respected since early August. A successful hold above this trendline could trigger a significant price reversal.
If ADA maintains its position above the trendline, a 14% rally towards the $0.9791 resistance level becomes a realistic possibility. Furthermore, a breakout past $1 could pave the way for a further 20% advance toward $1.20.
However, the Supertrend indicator currently shows a red signal above the price, suggesting ongoing selling pressure. The Relative Strength Index (RSI) at 39.97 is nearing oversold territory, hinting at a potential reversal.
Exchange Inflows: A Cause for Concern
Despite the bullish signals, a notable concern arises from the inflow of ADA into exchanges. Over the past 24 hours, approximately $5.95 million worth of ADA tokens has been deposited into exchanges. This could indicate potential profit-taking or an impending sell-off, which could dampen any upward momentum.
Traders should closely monitor these competing factors to gauge ADA's next move. Projects building on Cardano may also want to consider Codeum's security audit services to ensure the resilience of their smart contracts amidst market volatility.