- Cardano’s ADA breaks a critical resistance level, leading to liquidations and increased profitability.
- The percentage of profitable Cardano addresses reaches a two-year high, signalling long-term potential.
In the realm of cryptocurrencies, Cardano (ADA) has recently garnered attention due to its notable performance in the market. Amidst a positive sentiment prevailing across leading cryptocurrencies, ADA has breached a critical resistance level, indicating potential for further growth.
According to recent data from Coinglass, Cardano experienced a notable increase in liquidation, with shorts amounting to nearly $1 million being liquidated. This activity followed ADA’s price surge to $0.415, leading to significant liquidations by bullish investors totalling over $750K.
Insights from IntoTheBlock reveal a two-year high in the percentage of profitable Cardano addresses, standing at 39.5% (equivalent to 1.76 million addresses). This upsurge, triggered by Bitcoin’s rise to $40K, hints at ADA’s long-term potential and reinforces investor confidence. However, it’s crucial to note that 55.2% or 2.46 million addresses are currently in the red, with an additional 230K addresses at break-even.
Another key observation is the increased volume of large-scale ADA transactions, especially those over $100,000. This trend suggests growing interest from institutional investors and high-net-worth individuals, often precursors to significant price movements.
Market Sentiment and Price Dynamics
Despite ADA’s open interest hitting a six-month high, the prevailing market sentiment leans towards caution, with many investors choosing to exit at a profit. The long/short ratio has decreased, indicating a prevailing anticipation of a price decline from ADA’s recent high of $0.4.
As for ADA’s current price action, it hovers around $0.3992, reflecting a 2.3% increase from the previous day. The currency is navigating between the support at $0.37 and resistance at $0.41. The slight upward trend in the 20-day Exponential Moving Average (EMA), coupled with a Relative Strength Index (RSI) above 58, leans slightly in favour of the bulls. A successful breach of the $0.41 resistance could trigger an upward trend towards $0.42 and potentially $0.463.
On the contrary, a fall below the 20-day EMA and the uptrend line could signify profit-taking by short-term traders, possibly leading the price to dip towards $0.34, where the bulls might strive to prevent further losses.
