Cardano’s Value Drops, Yet Historical Patterns Suggest Potential Turnaround
The Bottom Line
Last week, Cardano (ADA) saw a value loss of over 12%. As Bitcoin (BTC) continues to show a bearish trend, many investors are wondering if ADA could potentially reach a new all-time high (ATH). Historical data suggests that such a development could be possible, although current technical indicators appear to be bearish.
Cardano in Bitcoin’s Shadow
The crypto market tends to follow the movements of Bitcoin. As BTC’s value recently fell below $66,000, many other cryptocurrencies, including Cardano, have also lost value. Current data from CoinMarketCap shows that ADA has fallen by over 3% in the last 24 hours and is currently trading at $0.5666. This development has negatively impacted market sentiment, with the weighted sentiment for ADA dropping according to Santiment data.
Possible Turnaround for Cardano
A look back shows that ADA usually reaches an ATH with a delay of 90 days after BTC reaches its ATH. Since BTC touched $73,000 a few days ago, this could suggest that ADA might soon start a bull rally. ADA’s on-chain metrics, including the MVRV ratio and NVT ratio, suggest a possible trend reversal, indicating that ADA could currently be undervalued.
Technical Indicators and Predictions
Despite the potentially bullish on-chain data, the technical indicators for ADA currently look bearish. The MACD, Money Flow Index (MFI), and Relative Strength Index (RSI) all point to a possible continuation of the downtrend. Investors should keep an eye on these indicators to make informed decisions.
Our Assessment
Although the current market situation for Cardano (ADA) appears rather bearish, historical data and certain on-chain metrics offer a glimmer of hope for a possible trend reversal. However, investors should be cautious and keep both the technical indicators and the overall market development in mind before making decisions. It remains to be seen whether ADA will be able to overcome the current bearish trend and reach a new all-time high.
Sources: Santiment, CoinMarketCap
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