Cardano price is down 2.78% to $0.37 during Monday’s US trading session. This bearish turn followed Bitcoin’s decline to $63,500 as most major altcoins are recovering from their strength after last week’s rally. Will the renewed recovery momentum push ADA price towards $1 or are sellers preparing for a larger correction?
Cardano price recovers amid reversal pattern and whale buying
Cardano price has remained an underperforming asset so far in 2024, recording a 37% year-to-date (YTD) loss to trade at $0.37. Daily chart analysis shows a falling channel pattern characterized by two sloping trend lines driving the current downtrend in ADA price.
However, since no trend stays the same in an established coin, the chart pattern offers the possibility of a reversal if the price crosses the upper trend line. During the recent market rally, Cardano price rose above the 20-day exponential moving average, indicating an initial change in market sentiment.
With sustained buying, ADA price is poised for a 10% jump before challenging the channel pattern resistance. The potential breakout will signal the end of the correction and lead to a 37% rally to $0.5.
Despite a lengthy correction, the ADA coin has seen a notable accumulation of addresses holding 1 to 10 million coins since mid-July, with the value stabilizing at around 5.72 billion ADA, according to Santiment data.
This accumulation suggests that major players are anticipating a future price recovery or are taking advantage of current price levels to increase their positions.
ADA price faces setback amid rising transaction costs
Moreover, the price of Cardano coin has recently caught the attention of the market due to a sudden increase in transaction fees. According to Messari data, the average transaction fee on the Cardano network rose to $0.2. The rising fees are usually related to growing project demand as more and more users compete for network space.
However, since Cardano is known for its scalability and affordability, striking a balance between network growth and affordable transaction costs will be crucial. If fees remain high, this could deter some projects from building on Cardano, especially given competition from other blockchains that offer lower transaction costs.
Therefore, the Cardano price rise to $1 seems to be a long-term goal and it is less unlikely that this goal will be achieved by the end of the third quarter.
Frequently Asked Questions (FAQs)
Cardano’s transaction fees have risen to $0.2, raising concerns about the network’s scalability and affordability
While Cardano is on the verge of a potential breakout from its current downtrend, rising transaction fees and overall market conditions make it less likely that ADA will hit the $1 mark by the end of Q3.
The accumulation of ADA by large holders (addresses with 1 to 10 million coins) suggests that major players are anticipating a future price recovery.
Sahil Mahadik
Sahil is a dedicated full-time trader with over three years of experience in the financial markets. Equipped with a strong understanding of technical analysis, he keeps an eye on the daily price movements of major assets and indices. Attracted by his fascination with financial instruments, Sahil has enthusiastically turned to the emerging space of cryptocurrencies, where he continues to explore opportunities fueled by his passion for trading.
Disclaimer: The content presented may contain the personal opinion of the author and is subject to market conditions. Conduct market research before investing in cryptocurrencies. The author or publication assumes no responsibility for your personal financial loss.
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