ADA, the native token of the Cardano blockchain, is showing strong potential for a significant uptrend after breaking out of a bullish price action pattern on the daily timeframe. Following a period of decline in the overall cryptocurrency market, there has been a resurgence in market activity, leading to a notable rally in ADA and confirming the breakout.
Cardano (ADA) has formed a bullish Head-and-Shoulders pattern on the hourly timeframe, indicating a positive trend reversal. The recent price recovery has seen ADA break out of this pattern, with the closure of an hourly candle above it. This pattern is typically seen as a buy signal by traders and investors, as it often signals a bullish momentum. Based on historical price data, if ADA maintains its position above $0.95, it could potentially reach the $1.24 level, representing a 25% increase in the near future.
On the hourly chart, ADA has surged above the 200 Exponential Moving Average (EMA), signaling a short-term bullish trend. This move further reinforces the positive outlook for ADA in the coming days.
In terms of on-chain metrics and trader sentiment, data from Binance indicates that 79% of ADA traders are currently holding long positions, reflecting a strong bullish sentiment in the market. The ADAUSDT long/short ratio stands at 3.75, with 78.96% of top traders holding long positions and 21.04% holding short positions. Open interest has also increased by 9.89% in the past 24 hours, suggesting a growing interest in ADA among traders.
Traders are heavily positioned on the long side at $0.908, with significant long positions totaling $22.40 million. Conversely, short sellers are over-leveraged at the $1.02 mark, with $3.87 million worth of short positions. This data indicates that traders are overwhelmingly bullish on ADA, which may explain the increase in long positions.
Currently, ADA is trading around $0.999, with a 7.5% increase in price over the past 24 hours. Despite the positive momentum and breakout, trading volume has decreased by 44%, suggesting a lower level of participation from traders and investors.
Overall, ADA’s price action and on-chain metrics point towards a bullish outlook, with the potential for further upside momentum in the near term. Traders and investors are closely monitoring ADA’s price movements, with expectations of continued growth in the coming days.