Cardano Breaks Downtrend Amid Bullish Signals
Key Takeaways
- Cardano (ADA) recently broke out of a downward trend from a technical perspective.
- Large investors (“whales”) are accumulating ADA – particularly in the 10 to 100 million ADA range.
- However, on-chain data shows mixed signals: network activity is declining.
- The price is currently holding above the key support zone at USD 0.80.
- Technical indicators suggest continued buying pressure.
Whale Activity on the Rise – What Does This Mean for ADA?
In recent weeks, large ADA investors – known as whales – have significantly increased their holdings. The most active group holds between 10 and 100 million ADA. This group has purchased approximately 1% of the total circulating supply, equivalent to around USD 296 million at the current price.
The next higher category (100 million to 1 billion ADA) has also shown increased buying activity over the past three days. Smaller retail investors have been steadily buying since February. Other holder groups, however, appear to be taking profits or pulling back.
Technical Analysis: Breakout from the Downtrend
Cardano has broken free from a short-term downtrend and successfully tested the previous support level at USD 0.68 on May 8. The price is currently stable above the USD 0.80 mark. The moving averages (20- and 50-day lines) are showing a bullish trend.
A key technical indicator, On-Balance Volume (OBV), is steadily rising. This indicates ongoing buying pressure – a positive sign for a potential continuation of the upward trend. The next price target is USD 0.91, the mid-range resistance of the current trading range.
Declining Network Activity – A Warning Sign?
Despite the positive price movement, activity on the Cardano network has recently declined. Both the number of daily active addresses and transaction volume dropped significantly on May 9. While such behaviour is not unusual on weekends, the decline was more pronounced than usual.
Token velocity – a measure of how frequently ADA changes hands – has also decreased. This suggests less selling, which could be a sign of accumulation. However, it remains uncertain whether the declining activity could negatively impact the price in the long run.
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Our Assessment
Cardano currently presents an interesting mix of technical and fundamental signals. The breakout from the downtrend, the holding of key support zones, and the increasing accumulation by large investors all point to further upside potential.
However, the declining network activity is a cause for caution. If this trend continues, it could put pressure on the price in the medium term. In the short term, however, the positive signals outweigh the negatives. Those holding ADA or considering an entry should closely monitor on-chain developments and key price levels.
Sources
- Santiment
- TradingView
| Symbol | ADA |
| Coin type | Alt Coin |
| Transaction Speed | High |
| Pros |
|
| Cons |
|
| Further practical applications | |
| Price | 0.799327 |
| 24h % | -3.72 % |
| 7d % | 22.35 % |
| 30d % | 21.51 % |
| 60d % | 11.35 % |
| 1y % | 78.56 % |
| Market Cap | $28,819,824,200.00 |
| Max. Supply | 45,000,000,000.00 |
| Official Links | Website | Whitepaper | Source Code |
| Socials | Reddit | X | Message Board |
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