- Cardano (ADA) surged by 64%, climbing from $0.50 to a local high of $0.82, reclaiming the critical $0.70 support level.
- ADA showed a 7.17% daily increase, recovering from a 21.93% weekly decline, signaling renewed investor optimism.
- On-chain metrics, such as the Chaikin Money Flow (CMF) and Adjusted RVT, indicated strong buying pressure and increased network activity.
- A declining NVT ratio and a positive Funding Rate further highlighted growing adoption and bullish sentiment.
- ADA’s next resistance lies at $0.80, with potential to test $0.96 if momentum holds, though volatility could lead to a retest of $0.70 support.
Cardano’s Strong Recovery: A Shift in Momentum
Cardano (ADA) has made an impressive recovery following the market-wide crash triggered by external economic factors. Over the past day, ADA surged by 64%, climbing from $0.50 to a local high of $0.82. This sharp upswing allowed the cryptocurrency to reclaim its critical $0.70 support level, a key psychological and technical milestone for investors. As of now, ADA is trading at $0.73, reflecting a 7.17% daily increase.
This recovery comes after a challenging week for Cardano, during which it suffered a 21.93% decline. The rebound has reignited optimism among investors, who appear to be taking advantage of the dip to accumulate more ADA. The question now is whether this momentum can be sustained, or if the altcoin will face renewed selling pressure in the days ahead.
On-Chain Metrics Signal Bullish Sentiment
Cardano’s recent price action has been supported by strong on-chain metrics, which suggest growing demand and accumulation. One key indicator is the Chaikin Money Flow (CMF), which measures the flow of capital into and out of an asset. Over the past day, the CMF for ADA spiked from negative territory to 0.11, signaling that buying volume is outpacing selling. This shift indicates that investors are actively accumulating ADA, particularly during price dips.
Another important metric is the 90-day Adjusted RVT (Realized Value to Transaction Volume), which has declined to 1.39. This drop suggests that more ADA is being transacted on-chain relative to its market cap, reflecting increased network activity and adoption. High activity levels on the Cardano network are a bullish signal, as they indicate that the cryptocurrency is being used more frequently for transactions and other purposes.
Adoption and Accumulation: NVT and Funding Rate Trends
Further evidence of Cardano’s growing adoption can be seen in its declining NVT (Network Value to Transactions) ratio, which has dropped to 1.4. A lower NVT ratio, when combined with an RVT above 1 but below 2, typically signals a healthy network with increasing usage. This trend suggests that Cardano’s network is experiencing a surge in activity, which could support further price appreciation in the near term.
Additionally, Cardano’s Funding Rate has turned positive after briefly dipping into negative territory during the recent market crash. A positive Funding Rate indicates that traders are willing to pay a premium to hold long positions, reflecting increased confidence in ADA’s price recovery. This shift in sentiment suggests that investors are now more bullish on Cardano’s prospects, anticipating further gains as the market stabilizes.
What Lies Ahead for Cardano?
With Cardano showing strong upward momentum, the next key resistance level lies at $0.80. If the current buying pressure and bullish sentiment persist, ADA could break through this resistance and target $0.96 in the near term. The Stochastic RSI, a momentum indicator, is also nearing a potential crossover. If this crossover occurs, it would confirm the continuation of the uptrend, providing further validation for bullish traders.
However, it’s important to note that Cardano remains highly volatile, and a correction could see the altcoin retest its critical support level at $0.70. This level will be crucial for maintaining investor confidence and preventing a deeper pullback. For now, ADA’s ability to hold above $0.70 will determine whether it can sustain its recent gains and build on its recovery.
Conclusion
Cardano’s recent price surge has reignited optimism among investors, with the cryptocurrency reclaiming its $0.70 support level and showing strong signs of accumulation. On-chain metrics, such as the CMF, Adjusted RVT, and NVT ratio, highlight growing adoption and bullish sentiment, while a positive Funding Rate reflects renewed confidence in ADA’s price trajectory.
Looking ahead, Cardano faces a critical test at the $0.80 resistance level, with the potential to target $0.96 if momentum holds. However, high volatility remains a risk, and a correction could see ADA retest its $0.70 support. For now, the altcoin’s ability to sustain its recovery will depend on continued buying pressure and broader market stability.
