Altcoins are now bleeding in red following the massive sell-off of Bitcoin (BTC) just two weeks after the approval of its spot exchange-traded funds (ETFs) in the US. However, there are a few indicators that Cardano (ADA) may reverse its trajectory soon.
Cardano (ADA) Now
At face value, Cardano appears to be in such a sorry state right now as it lost all the momentum it built up until December last year. After rallying up to $0.67 last month, it is trading around the $0.48 area as of this writing at 5:30 AM UTC. This shows a slump of 2.62% for the coin in 24 hours even though its trading volume pumped nearly 70% as $435.12 million of the digital asset moved between wallet addresses and exchanges. During the period, the prices swayed from a low of $0.478 and $0.5007.
The numbers are a far cry from the $3.10 all-time high we witnessed from ADA back in September 2021. But then again, the fortunes of its HODLers may finally find a silver lining if they keep their diamonds hands up to April.
The Road to $7
While everybody is panicking with the tanking prices and all the FUD circulating, popular crypto analyst and trader Ali (@ali_charts) on X sees a silver lining through some patterns emerging on his technical analysis. For him, Cardano may be heading not just to $1 or its former all-time high, but all the way to $7.
According to Ali, the ongoing consolidation phase of ADA emulates the same path it took in 2020 before topping above $3 the next year. This time, there may be a pitstop around the $0.80 if the pattern continues. From there, it could take a short correction down to $0.60 prior to the pump to $7.
That’s definitely a long way to go from where it is now. So, as usual, there are some oppositions to this analysis. Some question about where the liquidity of ADA will come from since there doesn’t seem to be any major interest coming from retail or institutional investors.
Whale Migration Toward Cardano
Interestingly, there has been a huge chunk of whale transactions observed within ADA’s ecosystem. Whale transactions are single trades exceeding $100K and these are usually referenced by analysts when estimating the sentiments of wealthy individuals and institutional investors.
Based on the on-chain data from IntoTheBlock, Cardano exhibited 25.71 billion ADA whale trades in the past 24 hours. It went on a high of 29.4 billion ADA and a low of 21.2 billion ADA in the weekly frame.
The numbers are surprisingly way more than the large transaction volumes of the second largest crypto by market cap, Ethereum (ETH). In comparison, ETH has only displayed 2.24 million ETH whale trades with the weekly charts peaking at 2.24 million ETH and dipping as low as 874.96K ETH.
Final Thoughts (Not an Investment Advice)
Despite the tanking prices due to the massive outflows of crypto assets after the spot Bitcoin ETF “sell the news” event, the scenarios painted here provide hope for the better things to come in Cardano. Let’s not forget that ADA will also likely benefit from another upcoming spike in public interest toward crypto as we get closer to the Bitcoin halving.
All these would help reinforce the positive forecasts here, but also keep in mind news and other factors that may come into play along the way that could cancel out these projections. As usual, exercise due diligence before, during, and after placing your trades.