CoinDesk Reports:
ADA’s trading volume has seen a sharp increase while its price declines. Some indicators suggest a bullish trend on the charts.
Like most cryptocurrencies, Cardano’s [ADA] performance over the past 24 hours has been positive, with its daily chart turning green days after. However, there could be better news ahead, especially if certain conditions are met, as ADA may be on the brink of a bullish breakout.
Let’s explore what ADA needs to maintain optimism on the price chart.
More Green for Cardano
Ahead of its recent uptick, Cardano saw a decline of over 9% in just 7 days. There has been a turnaround in the last 24 hours with the token’s price rising by over 6%.
At the time of writing, Cardano is trading at $0.3552 with a market cap exceeding $12.7 billion.
However, data from IntoTheBlock indicates that over 75% of investors are still at a loss, accounting for 3.37 million ADA addresses.
Notably, the price decline has also negatively affected the MVRV ratio. Its trading volume has increased during the price drop — typically seen as a bearish signal.
Yet, with a bullish trend visible on the 12-hour chart, all these indicators and market conditions could potentially reverse.
According to AMBCrypto’s analysis, Cardano has been consolidating within a descending wedge pattern since March. At the time of writing, it is about to test the pattern’s lower bounds.
For ADA to initiate a bullish trend, it must paint 3-4 green candles. Should this occur, a significant rise in ADA bulls would not be surprising, allowing it to retest its highs from March in the coming weeks or months.
Probability of ADA Breakout
When AMBCrypto reviewed Hyblock Capital’s data, an interesting correlation emerged.
Based on our analysis, whenever ADA’s cumulative liquidation level Delta turns green, ADA’s price tends to rise. Conversely, when the indicator turns red, the token’s price declines.
At the time of writing, although the indicator is red, its figures are decreasing. Simply put, ADA may soon spark a bullish trend on the charts.
Similarly, the Relative Strength Index (RSI), after touching oversold territory, shows an upward trend, indicating a bullish sentiment.
Is your portfolio in the green? Check out the Cardano profit calculator.
Nevertheless, other indicators are bearish. For instance, the MACD has shown a bearish crossover.
Finally, the Chaikin Money Flow (CMF) is trending downward, remaining below neutral levels. This could potentially limit ADA’s price rise in the coming days or weeks.