Cardano Bulls Show Strength Amidst Network Activity Challenges
Cardano bulls are flexing their muscles following a rally that sparked a strong rebound from recent lows. While the platform has seen an uptick in trading volume, network activity has taken a hit leading to lower volatility. Despite short liquidations exceeding $800 million, daily active addresses have decreased as prices continued to climb.
Despite the drop in daily active addresses, a significant increase in trading volume of 30% to 40% has been observed in recent days. This rise in volume, coupled with reduced network activity, suggests whale accumulation and subsequent decreased volatility. As a result, the ADA price is facing resistance at a key level, despite finding strong support at the 200-day moving average.
While the ADA price recently broke a short-term descending trend, it has struggled to maintain upward momentum. Hovering around $0.8, the price has failed to surpass $0.85, which could have shifted the token’s trajectory away from bearish pressures. Retail investor participation has declined, leading to price consolidation within a range.
Despite a bullish breakout, the ADA price remains ensnared in a descending parallel channel due to bearish pressure. Although the price has surpassed the 200-day MA, breaking free from the channel resistance has proven challenging, indicating weakening bullish momentum. The RSI nearing overbought territory could signal a breakout from the pattern.
A potential bullish crossover between the 50 & 200-day MAs, along with a confirmed Golden cross, could propel the price above $1. The upcoming weekly close will be crucial for ADA’s price trajectory, with failure to breach $0.85 likely resulting in continued consolidation within the pattern.