ADA, the native token of the Cardano blockchain, is showing signs of a potential price recovery after experiencing a significant drop in price. Traders were concerned when ADA reached the crucial support level of $0.65, but a green candle has shifted market sentiment in a positive direction.
The reason ADA has been able to hold this support level is due to its history of price reversals and the strong buying pressure at $0.65. This support has provided a foundation for the asset to potentially bounce back.
Currently, ADA is trading around $0.69, with a slight decline of over 0.85% in the past 24 hours. Despite this dip, trading volume has surged by 85%, indicating increased participation from traders and investors.
Technical analysis suggests that ADA is on the path to recovery, with the formation of a bullish morning star candlestick pattern on the four-hour chart. If ADA can maintain its position above $0.65, there is a possibility for the asset to surge by 21% and reach the $0.83 level in the near future.
Furthermore, ADA’s technical indicators are showing a bullish divergence on the daily timeframe, supporting the potential for a price recovery. However, if sentiment shifts and ADA falls below $0.65, there is a chance that the price could drop by 30% to reach $0.45.
Traders are starting to build their long positions after continuously betting on the short side, as indicated by data from the on-chain analytics firm Coinglass. The ADA exchange liquidation map reveals that traders are over-leveraged at $0.695, with $3.70 million in short bets, while bulls have amassed $19.50 million in long positions at $0.62.
Overall, ADA’s current market structure and price action suggest that the token is poised for a potential price recovery. With strong support at $0.65 and bullish indicators pointing towards an upward move, ADA could see significant gains in the coming hours.