Cardano Sharks Circle Ahead of Potential Bullish Breakout
On-chain data shows that buying pressure from mid-size "shark" holders is increasing, which could trigger a bullish breakout.
Key Takeaways
- Cardano is currently consolidating between the $0.43 support and the $0.50 resistance.
- Meanwhile, mid-size "shark" holders have added over 79 million ADA to their positions.
- Overcoming resistance at $0.50 could trigger a 52% breakout. Â
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Cardano continues to consolidate within a tight price range that is getting narrower over time. The eighth-largest cryptocurrency now looks primed for a significant price movement after enduring a prolonged period of stagnation.
Cardano Gains Momentum
Cardano appears to be gaining momentum for a significant price movement as mid-size holders add to their positions.
Data from Santiment reveals a significant spike in buying pressure behind Cardano despite its stagnant price action. The on-chain, social, and financial analytics firm affirmed that addresses holding between 10,000 and 100,000 ADA have entered an accumulation phase, adding more than 79 million tokens to their positions over the past month. These mid-size holders, often referred to as “sharks” currently account for over 10% of all ADA holdings. Meanwhile, “whales,” which hold between 100,000 and 10 million ADA, have stopped selling their tokens.
The sudden spike in buying pressure could positively impact Cardano’s price. ADA appears to be consolidating within a descending triangle on its daily chart. As prices edge closer to the pattern’s apex, the odds for an explosive price movement increase.
Further upward pressure could help Cardano overcome the $0.50 resistance level, triggering a bullish breakout. Based on the height of the triangle’s apex, ADA could gain the strength to surge by up to 52% toward a target of $0.70.
Cardano needs to hold above the $0.43 support level to have a chance of printing higher highs. Failing to stay above such a crucial price point could be perceived as a sign of weakness, encouraging investors to sell their holdings. If this were to happen, ADA could drop to $0.38, or even go as low as $0.24 if its downtrend continues.
This pessimistic thesis coincides with Peter Brandt’s assessment of Cardano’s price action. The trading veteran maintains that ADA needs to rise above its Jun. 16 high of $0.55 to avoid “the very definition” of an “ugly” outlook.
Disclosure: At the time of writing, the author of this piece owned BTC and ETH.
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