As the SEC’s determination regarding a potential ADA ETF draws near, Cardano’s on-chain activity is capturing more attention.
Market observers are closely monitoring to assess if the recent rise in ADA volume and Total Value Locked (TVL) indicates restored investor confidence or short-term speculation.
On-chain indicators display conflicting signals
Data from DefiLlama showed a noticeable uptick in Cardano’s trading volume in the last few months, peaking in December before decreasing.
Currently, daily trading volume is below $10 million, a significant drop from its peak of over $30 million in late last year.
This decrease implies reduced transactions on the network and a drop in activity levels.
On the contrary, Cardano’s TVL remains robust despite fluctuations, reaching over $700 million before retracting to around $500 million.
Despite this dip, it still indicates a notable improvement from mid-2024 when TVL was around $200 million.
This suggests that Cardano’s DeFi ecosystem is resilient amidst market uncertainty.
ADA price striving for a rebound
ADA’s price has been showing signs of recovery, currently trading at $0.8082.
The 50-day Moving Average(MA) at $0.8335 is a crucial resistance level, while the 200-day MA at $0.9289 is well above the current price, indicating a longer-term downward trend.
Nonetheless, the Relative Strength Index (RSI) is at 53.10, signaling that ADA is neither overbought nor oversold.
This neutral position suggests that the asset could move in either direction depending on market developments.
What lies ahead for ADA?
The SEC’s decision on the ADA ETF could serve as a significant catalyst for the asset. A positive ruling might stimulate institutional interest, propelling ADA’s price towards $1.00. Conversely, a denial or delay of the ETF could hinder ADA’s momentum.
In the short term, traders should keep an eye out for a breakout above $0.8335 to confirm bullish momentum. If rejected at this level, further consolidation near $0.77 or lower is probable.
With heightened on-chain activity and a pivotal regulatory event on the horizon, ADA remains a high-stakes asset to monitor in the upcoming weeks.