Cardano Price Analysis

Cardano price is slowly forming a popular bullish pattern, indicating a potential strong bullish breakout in the coming weeks or months.

Current Market Status

Cardano (ADA), a popular proof-of-stake coin, remains in a bear market, having plummeted by nearly 50% from its peak in November.

However, some on-chain data and technical indicators suggest that a strong bullish move could be on the horizon.

On-Chain Data

Santiment data shows that the Mean Dollar Invested Age (MDIA) has been rising over the last few months. The 180-day MDIA indicator has leaped to 10.68 from -3.2 in February.

Similarly, the 2-year MDIA indicator has increased to 103, up from the year-to-date low of 94. This indicator, which tracks the average age of each dollar invested in a cryptocurrency, is often seen as a precursor to major price rebounds.

As the indicator rises, it suggests that older, stagnant wallets are reinvesting their tokens, which is a bullish sign.

Recent Price Action

Recently, Cardano has been affected by market declines, which some attribute to profit-taking after its robust performance in the last quarter. Additionally, ongoing fears around tariffs imposed by President Donald Trump have contributed to the bearish sentiment.

Technical Analysis

The daily chart reveals that ADA prices have been in a downward trend, dropping from a high of $1.328 in December to around $0.70, forming a series of lower lows and lower highs.

The coin has recently created a bearish pennant pattern, consisting of a vertical line and a symmetrical triangle, which typically leads to a significant bearish breakdown.

On a more promising note, a falling broadening wedge pattern is developing, characterized by two descending trendlines. Historically, this pattern has often led to a strong bullish breakout.

Thus, the most plausible scenario is that the bearish pennant may trigger a drop to the lower side of the wedge at $0.555, followed by a subsequent uptrend. A rebound could potentially push the price back to the psychological mark of $1, before aiming for last year’s high of $1.32, approximately 90% above the current level.

Additional Reading

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