Could Cardano [ADA] be gearing up for a significant price movement? There are several indications pointing towards a potential bullish trend in the near future.
ADA has been facing challenges in generating sufficient trading volumes to recover from its recent setback. Nonetheless, a shift might be on the horizon as whale activity has been on the rise.
As October commenced, the cryptocurrency experienced a notable decrease in the movement of large holders, both in terms of inflows and outflows.
This week, large holder activity for ADA saw a resurgence, suggesting that whales are once again displaying interest in the asset.
In the past 24 hours, large holder inflows reached 4.79 billion ADA, while outflows amounted to $4.72 billion.
The data indicates that large holders saw a net increase over the past day, indicating some accumulation. This shift hints that sentiment could be turning in favor of the bulls, despite recent bearish trends.
Additionally, on-chain data highlights a rise in long positions over the past three days, reinforcing the growing bullish sentiment within the market this week.
Impending ADA Breakout: What to Expect
The upsurge in long positions and heightened whale activity are not random occurrences but more likely connected to ADA’s price behavior. The cryptocurrency has been following a wedge pattern supported by ascending levels and descending resistances.
For the last two weeks, ADA has been consolidating around its ascending resistance line, displaying resilience. Moreover, the price is nearing the squeeze zone, indicating an imminent pattern breakout.
At the time of writing, ADA was trading at $0.34. The Money Flow Indicator (MFI) has been signaling a continual inflow of liquidity into the cryptocurrency over the past seven days.
However, this influx has not been substantial enough to instigate a notable bullish rally.
Nonetheless, this observation aligns with the overall positive flows observed in large holder accounts and the increasing long positions.
The spike in whale activity at recent discounted price levels suggests a notable possibility of an impending bullish breakout unfolding over the weekend.
If a robust bullish breakout materializes, ADA could potentially register a gain exceeding 20%. Yet, this outcome is not guaranteed, and a bearish breakout could transpire if the cryptocurrency fails to generate sufficient demand.