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Cardano Crisis Or Comeback? ADA’s Key Metric Hits Low, What This Means For Investors

Data from analytics platform IntoTheBlock have illuminated a troubling trend within the Cardano (ADA) network, showing a significant dip in ‘profitability’ for its holders.

While cryptocurrencies like Bitcoin and TRX show a high percentage of holders in profit, Cardano stands in stark contrast, with only 35% of its holders currently seeing gains.

This insight into the Cardano ecosystem reveals deeper challenges, as many of ADA’s transactions now appear to be at a loss.

Details Into ADA Investors Profitability

The report’s specifics indicate that out of 1.59 million addresses holding 14.07 billion ADA, a substantial amount of these tokens were acquired at higher price points that are not profitable under current market conditions.

In particular, 2.73 million addresses are underwater, holding 20.07 billion ADA purchased at price levels between $0.5975 and $0.7265. This significant segment of loss-bearing investments places downward pressure on ADA’s market price, contributing to recent price volatility.

Cardano (ADA) holders metric.

Despite the immediate bearish outlook, ADA has shown resilience with a weekly gain of 4.2%, bringing its price to $0.4661 at the time of writing. This slight recovery suggests that while short-term pressures are evident, investor confidence remains in the token’s fundamentals.

Notably, the crypto community is buzzing about potential future gains for ADA based on historical data and technical analysis. Prominent crypto analyst Ali has pointed out that ADA’s Market Value to Realized Value (MVRV) ratio is lower than -22%, indicating that the asset is significantly undervalued.

This situation is similar to June 2023, following which ADA experienced a substantial 75% increase in value. Ali forecasts a potential surge in ADA’s price to $0.80 from these past trends, which would mark a significant recovery and the highest value for the token in over a year.

Cardano Technical Analysis Supports Bullish Predictions

Another analyst, Trend Rider on X, further supported the optimistic projections for ADA and noted that Cardano’s technical indicators signal a potential bull run.

According to Trend Rider, ADA’s Relative Strength Index (RSI) and Simple Moving Average (SMA) crossovers form a pattern that mirrors previous setups, leading to major price increases. For instance, a similar formation was observed before ADA’s monumental rise from $0.05 to $3.00.

This confluence of technical and market value analyses presents a compelling case for Cardano’s potential turnaround. While current holder profitability is low, the technical indicators and historical performance suggest that ADA could be on the cusp of a significant upward trajectory.

ADA price chart on TradingView

Featured image from Unsplash, Chart from TradingView

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Why Cardano (ADA) Is A Top Altcoin Pick In The Next Bull Run

Dan Gambardello, the founder of Crypto Capital Venture, has laid out a bullish narrative for Cardano going into the next bull run. Based on his analysis, the crypto token has the potential to be one of the best-performing coins during that period. 

History Could Repeat Itself For Cardano

In a video posted on his YouTube Channel, Gambardello mentioned how Cardano was currently in the same technical area it was in the last two market cycles before the Bitcoin Halving. He further noted that on those two occasions, ADA managed to surpass expectations and ended up clocking a new all-time high (ATH) in the process. 

Specifically, ADA is said to have seen a 2700% gain on its way to its current ATH of $3 after the 2020 Bitcoin Halving. Gambardello believes that this time will be no different despite ADA being significantly down from its ATH. Although he was trying to be cautious with his price predictions, he raised the possibility of Cardano seeing an 1800% gain on its way to $10 in the next bull run. 

Interestingly, that isn’t the crypto analyst’s most bullish prediction so far. He once stated that ADA could rise to $11 at a market cap of $400 billion. Then, he hinted that ADA could enjoy a similar run as ETH did in the last bull run due to its DeFi functionalities. 

This time around, he once again made the ADA and ETH comparison, noting that the former hitting a market cap of $350 billion in the next bull run is still way less than ETH’s market cap in the last bull run. 

Cardano ADA price chart from Tradingview.com

Bitcoin Halving Is The Key To Unlocking The Next Bull Run

Before now, Gambardello had hinted that the Bitcoin Halving was going to kickstart the next bull run. In his recent video, he once again suggested that the next bull run was going to start after the Halving in April, noting how the bull cycles always take place after this event. He further highlighted how the Bitcoin chart was also indicating that the next bull run is imminent. 

According to the crypto analyst, “a simple zoom out on a Bitcoin chart” shows that there is so much to be bullish about. Altcoins are not left behind, as Gambardello also claimed that the charts of altcoins like ADA and ETH suggested that something was getting ready to happen, implying that a massive rally was on the horizon. 

Meanwhile, Gambardello wasn’t only bullish on the crypto market from a technical analysis perspective. He alluded to fundamentals like recent developments around the Spot Bitcoin ETFs, which show increased demand for the flagship crypto token, Bitcoin. 

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Cardano Could See 70% Rally To $0.75, Analyst Predicts When

An analyst has explained how Cardano may be heading towards a rally to $0.75 soon if the historical pattern is anything to refer to.

Cardano Could See A Rally Of Over 70% In The Near Future

As explained by analyst Ali in a post on X, ADA currently appears to be mirroring the same pattern as that between 2018 and 2020. Below is the chart shared by the analyst, which points out this similarity.

Cardano Pattern

From the graph, it’s visible that ADA had been in a phase of consolidation inside a channel back between 2018 and 2020, and it would appear that the asset has been ranging in a similar fashion recently as well.

There is one dissimilarity present between the two patterns, however, and that is the presence of the COVID-19 crash. This price plunge below the consolidation channel only happened because of the emergence of an anomaly in the form of the virus, though, so it might be safe to ignore it in the grand scheme of things.

Cardano has recently observed a rally towards the upper end of the channel and the cryptocurrency is now trying to break out of it. Back during the previous consolidation period, a similar break took place, and it ended up leading to a very significant uplift for the cryptocurrency.

“If this pattern holds, we could see ADA punching through the $0.45 resistance soon,” notes Ali. As for what trajectory the asset would follow after this break, the analyst thinks that a rally towards the $0.75 level could potentially happen by “late December.”

From the current spot price, such a surge would mean an increase of more than 70% for Cardano. If the previous instance of the trend is anything to refer to, though, the rally would perhaps not end at just these gains, as ADA in fact eventually ended up registering a total increase of almost 3000% in the bull run that followed then.

The on-chain analytics firm Santiment also discussed about ADA yesterday, revealing a possible instigator behind the latest price uptrend in the asset. The relevant metric here is the total number of ADA addresses carrying some amount of balance.

The below chart shows how this indicator’s value has changed over the last few months:

Cardano Wallets

As displayed in the chart, the total number of Cardano wallets observed a sharp decrease last month and what occurred alongside it was a rally in the price. In recent days, another decline in the indicator has taken place, although the scale is much smaller this time around.

“Typically, declining wallets is a sign of small holders capitulating & selling to whales at a loss,” explains the analytics firm. ADA has observed an increase in the past few days, so it’s possible that this effect may be in action once more.

ADA Price

Cardano has again been rejected from the $0.45 resistance mark as its price has pulled back to $0.43 since the retest.

Cardano Price Chart

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Crypto Analyst Predicts 1 Altcoin Will Fall Down Hard – Is It Cardano?

Pseudonymous crypto trader and analyst Capo tweets that Cardano (ADA) is bound to go on a massive downward trend.

This popular crypto trader with over 307,500 followers on Twitter predicted a massive plunge before the coin finishes its five-waved downward trajectory following the Elliott Wave Theory.

The Elliott Wave Theory pertains to a technical analysis that can predict price action by looking into mind psychology or crowd behavior that can be seen in waves.

Based on the theory, the crypto asset would always go through a predictive five-wave cycle before it makes that pivot or reversal.

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Before the coin completes its five-wave downward course, Capo anticipates a catastrophic crash (Coingape).
Capo Predictions On ADA, BTC, Terra, STEPN

According to Capo, ADA is on its way to completing the fourth wave which means it’s ready for that final wave.

Cardano is currently trading at $0.55 which is categorically 45% above the target price point of $0.30.

Cryptocurrencies recovered quite a bit on Friday but crashed today which appeared to be a roller-coaster ride of sorts.

The erratic market moves have been worrisome for many crypto traders and investors alike. Bitcoin (BTC) has fallen by 3.6% and Cardano (ADA) went down by 6.65%.

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With the Federal Reserve pulling a tight rein on monetary policy, there isn’t a hint of a bullish trend. With the way things are going, many traders are looking for safer crypto assets compared to riskier ones.

Meanwhile, Capo is also keeping a steady eye on STEPN, a move-to-earn app built on the Solana blockchain. Capo says that he is looking at a significantly low trading value of $0.60. Looks like GMT is heading down the basement, as he describes. GMT is currently trading at $1.52.

ADA total market cap at $18.42 billion on the weekend chart | Source: TradingView.com
Bitcoin Still Better Than Cardano?

Outlook for Bitcoin looks good as it continues to correct after going over the key support locked in at $30,000. The $30,000 support supposedly jarred it. A two-day candle has closed right below it and currently tapping that zone as support. At this point, this spot is still not good for buying.

Adding salt to the wound is the miserable turnout in the market value of TerraUSD that is pegged to USD. It’s now priced at $0.18 this week. Meanwhile, TerraUSD is mapping out a recovery plan this week.

Overall, Cardano is more volatile compared to Bitcoin although it appeals greatly to the broader market, in general.

Bitcoin has more promise to be bullish for the long term compared to other coins, including ADA.

Featured image from Forkast News, chart from TradingView.com