The overall sentiment in the digital currency market appears to be somewhat perplexing. In the midst of this uncertainty, Cardano (ADA) has displayed signs of bullishness and is potentially gearing up for a significant upward surge in the near future.
ADA has witnessed a decline of approximately 20% in its value over the last few weeks, reaching a level where it previously embarked on an impressive rally.
The optimistic outlook for ADA seems to have been influenced by recent price movements and the impending presidential election in the United States.
Cardano (ADA) Technical Analysis and Critical Thresholds
As per CryptoCrypto’s technical analysis, ADA is currently positioned at a critical support level of $0.315 and is trending upwards. Historically, whenever ADA has touched this support level, it has encountered buying pressure, resulting in a surge of at least 20%.
Having hit this support level thrice since July 2024, ADA has consistently experienced buying pressure, leading to a price rally of over 20% to reach the $0.40 mark. Traders and investors are now anticipating a similar bullish move in the days ahead.
Despite the positive projections and the expected rally, the on-chain metrics for ADA depict a bearish sentiment among traders. Coinglass, an on-chain analytics firm, reports that ADA’s Long/Short ratio is currently at 0.88, indicating a prevailing bearish sentiment.
Moreover, the open interest for ADA has decreased by 1.2% in the past 24 hours, suggesting a potential liquidation of traders’ positions due to heightened volatility in the cryptocurrency market.
Presently, 53.2% of top traders have taken short positions, while 46.8% are holding long positions.
Key Liquidation Levels to Watch
According to Coinglass data, the major liquidation levels are identified at $0.323 on the lower end and $0.338 on the upper end. Traders are deemed to be heavily leveraged at these levels.
If the sentiment remains unchanged and the price climbs to $0.338, short positions worth nearly $1.79 million are anticipated to be liquidated.
Conversely, a shift in sentiment leading to a price plunge to $0.323 could result in the liquidation of approximately $2.43 million worth of long positions. The combination of on-chain metrics and technical analysis points towards a mixed sentiment prevailing among traders.
Currently, ADA is trading around $0.33, showing no significant change over the last 24 hours. During this period, the trading volume has decreased by 62%, indicating reduced involvement from traders and investors compared to previous trading sessions.