- ADA’s consecutive increase comes to an end.
- Cardano has a chance to see a price rally.
Cardano [ADA] holders experienced a glimmer of hope as ADA concluded the week on a high note. The positive price movement was a welcome change, especially considering the significant decline ADA has faced in recent weeks.
However, a different narrative emerged when examining the volume chart, casting doubt on the sustainability of the recent trend.
Cardano ends the week on a high
Analysis of the Cardano price chart on a daily time frame revealed a strong finish to the past week. ADA experienced approximately an 8.3% increase on 20th April, closing the day near $0.5.
This surge marked a notable end to the consecutive uptrend that began on 18th April and provided a respite from the significant declines observed in the preceding week.
Source: TradingView
At the time of this writing, ADA continued to trade around the $0.5 price range, with a slight increase of over 1.5%. However, despite the consecutive uptrends, ADA remained entrenched in a bear trend.
Examination of the Relative Strength Index indicates that it remained below the neutral line, signaling a lack of positive momentum in its price trend at the moment.
Cardano volume shows a lack of convergence
Analysis of the Cardano volume revealed a disparity between traders’ activity and the price movement. Despite the positive price trend, the volume did not exhibit the same level of excitement and has failed to surpass the $500 million threshold.
Although the volume surged to over $1.3 billion at the beginning of the week, it has since declined by more than half. At the time of this writing, the volume was around $402 million.
Source: Santiment
This discrepancy suggests a lack of convergence between price and volume, indicating a potential lack of sustainability in the price uptrend.
The stagnant volume implies a dearth of participation from traders, which is crucial for sustaining price increases. With increased volume, the current price trend may be able to maintain momentum.
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Interest in ADA sees a slight rise
Examining the Cardano Open Interest on Coinglass revealed a notable decline in recent days. Despite a slight increase at the time of writing, it has yet to manage to reclaim previous levels.
At the time of this writing, the Open Interest was around $207.8 million, a significant drop from the over $400 million observed around 10th April. This trend in Open Interest indicates a reduction in the influx of cash into ADA.
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