- Santiment’s on-chain data indicates a bullish trend for ADA, emphasizing a surge in transactions involving whales.
- The optimistic scenario also suggests a breach of resistance at $0.5410 could lead to further gains, challenging levels above $0.6000.
As Cardano (ADA) endeavors to stage a recovery rally in the aftermath of a substantial market downturn, the cryptocurrency faces a formidable resistance barrier. Analysts at behavior aggregator Santiment suggest that the movement in ADA’s price is potentially influenced by large holders, with on-chain metrics providing insights into this trend.
On Tuesday, January 29, ADA’s price witnessed a nearly 13% increase after finding support around the 100-day Simple Moving Average (SMA) at $0.4648. Santiment’s analysts also point out that the surge is due to shark wallets (addresses holding between 500 and 1000 ADA tokens) and whale wallets (addresses holding over 1000 ADA). At press time, Cardano (ADA) is, however, trading down 3.99% at $0.5083 with a market cap of $18 billion. But despite these price woes, Cardano’s smart contracts deployments have been on the rise.
According to the report, an additional 639 million addresses, holding between 100,000 and 100 million ADA tokens, have reemerged over the past eight months. The resurgence of these wallets suggests the potential for Cardano’s price to continue its upward trajectory, challenging the resistance posed by the descending trendline at $0.5410.
A successful breach of this resistance could propel ADA towards the 50-day SMA at $0.5597, setting the stage for a further advance towards the psychological level of $0.6000, representing a 15% increase from current levels.
In an optimistic scenario, Cardano’s price might extend gains further, targeting the blockade at $0.6412 or higher. Surpassing the psychological level of $0.6800 could pave the way for reclaiming the $0.6831 range high.
On-Chain Data Paints Bullish Picture for ADA
Santiment’s data highlights a significant surge in the transaction count involving whales, denoting large holders transferring amounts ranging from $100,000 to $1 million worth of ADA. This observation aligns with Santiment’s broader analysis.
Conversely, in the event of heightened selling pressure, Cardano’s price might decline, potentially breaking below the 100-day Simple Moving Average (SMA) at $0.4648. Under more severe circumstances, the downturn could extend to the $0.3790 mark, levels not observed since December 1, 2023. This potential move would signify an approximate 30% decrease from the present levels.
Cardano’s ADA is currently the eighth-largest cryptocurrency by market cap. Cryptocurrency observer Eric Wall has stirred controversy in the Cardano community by making a daring and unsettling forecast that ADA will drop out of the top 10 digital assets by the end of the year.
Intensifying concerns, Wall proposed that Polygon (MATIC) would surpass ADA’s position, heightening the community’s anxiety and doubt. Despite optimistic projections of substantial surges, even up to 2000%, for Cardano, Wall remains unconvinced that 2024 will be ADA’s breakthrough year.
In response, Cardano founder Charles Hoskinson reacted with a sarcastic GIF featuring the caption, “Well… we’re waiting!”
https://t.co/4TgoyGIkQl pic.twitter.com/JDVeGET9db
— Charles Hoskinson (@IOHK_Charles) January 29, 2024
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