- After a major correction, ADA’s price hiked by over 1.5% in 24 hours
- Metrics looked bullish, but market indicators suggested otherwise
Cardano [ADA] recorded a major price correction last week, one that pushed the token’s price down to $0.42. However, the scenario changed over the last 24 hours as its daily chart turned green. Ergo, the question – Does this indicate the beginning of a bull rally? One that Cardano has been planning for several weeks?
Cardano following a historical trend
ADA didn’t begin May on a good note as the bears took control of the token’s price. However, that changed soon after as the cryptocurrency hiked by almost 2% to trade at $0.4677 with a market capitalization of over $16.6 billion, at press time.
Now, though this might not seem bullish at first glance, there is more to the story here. Ali, a popular crypto-analyst, recently shared a tweet highlighting how ADA has been mimicking its 2019 price action. According to the same, the altcoin consolidated within a parallel channel, signaling an end to the bear market in 2019.
At the time, Cardano broke out of the channel with a 75% surge, followed by a 56% price correction, which prepared the market for a massive 4,095% bull run.
It would seem that ADA has started to act similarly in 2023, with the crypto consolidating within a parallel channel before breaking out with a 72% surge. If the altcoin is finally done with its correction on the charts, one can expect ADA to initiate yet another bull rally. If that happens, the crypto will hit new heights soon.
Since the likelihood of a massive rally is high, this might be the right time to accumulate. And yet, the total amount of holders for Cardano remained flat over the last three months – A sign that new investors didn’t buy ADA.
Source: Santiment
What do metrics say?
AMBCrypto then analyzed Santiment’s data to see whether metrics also hinted at history repeating itself. A bullish metric was the MVRV ratio, as it registered a steep uptick.
Whale activity around the token also remained high last week. Additionally, Cardano’s open interest hiked along with its price – A sign that a bullish uptrend could be sustained.
Source: Santiment
However, unlike the aforementioned metrics, most technical indicators seemed bearish. For instance, the Money Flow Index (MFI) registered a sharp decline. The Chaikin Money Flow (CMF) also followed a similar trend.
These suggested that ADA might not be able to begin a massive bull rally, at least in the short-term.
Realistic or not, here’s ADA’s market cap in BTC terms
On the contrary, the MACD flashed a bullish crossover. If a bull rally happens, then it will allow more investors to be in a better position.
This was the case as at press time, only 35% of ADA investors were in profit, according to IntoTheBlock’s data.
Source: TradingView
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