- Technical analysis of Cardano showed bulls have a reason to be enthusiastic.
- Social sentiment remained weak despite the breakout past $0.4.
Cardano [ADA] was trading in a falling wedge pattern until recently when it saw a bullish breakout. This incident promised a 70% rally for the token, but the bulls will face many hurdles ahead.
Source: ADA/USDT on TradingView
The price action on the daily chart had a bullish structure. The RSI and the CMF noted strong upward momentum and sizeable capital flow into the market, respectively.
The DMI signaled a potential trend change on the 13th of July when the DIs crossed over.
The $0.4 former resistance was flipped to support, and so long as the bulls defended it, another move higher remained likely. AMBCrypto took a closer look at other metrics to gauge the market sentiment.
The active address count has been steady since April
Source: Santiment
The daily active addresses have hovered around the 32k-34k mark since April. The user count has not fallen despite the downtrend Cardano prices saw since May, which was positive.
It denoted network health and belief in the blockchain even through slightly tough times on the price front.
The circulation has fallen dramatically in the past two months, a sign of scarcity and reduced transactions. The velocity, which measures how often a token exchanges hands, has also declined over the past month.
Together, they hinted at accumulation and reduced speculation. This could foreshadow an uptrend in the coming weeks.
Social metrics were weakened
Source: Santiment
The development activity remained relatively high despite the price downturn, which is a strong positive for long-term investors. The 3-day weighted sentiment was sharply negative even though the $0.4 zone was now a support.
The social volume has also decreased slowly since early May. Together they showed that social media sentiment was not aiding the bullish cause yet.
Read Cardano’s [ADA] Price Prediction 2024-25
The Chang hard fork could see prices venture northward with renewed vigor. Traders also need to be prepared for the news not doing much to the price trend.
The evidence at hand showed bulls have an advantage, but social media hype was missing for Cardano.
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