Cardano’s decentralized exchange (DEX) has experienced a surge in daily trading volume, surpassing 23 million ADA, as price volatility remains high.
While the DEX volume has seen a significant increase, other indicators paint a bearish picture for Cardano (ADA). The total value locked (TVL) for the cryptocurrency has dropped from $430 million to $230 million, indicating a decline in interest and activity. Additionally, there has been a decrease in NFT trades on the network, following a trend seen on other platforms.
These declining metrics could have a negative impact on ADA prices in the near future. On-chain metrics also suggest bearish pressure, with Cardano’s technical indicators showing a weakening bullish momentum. Both the RSI and CMF have declined, signaling a decrease in buying pressure.
Furthermore, the MVRV ratio for ADA has fallen significantly, indicating a decline in profitability for most addresses. This could lead investors to either take advantage of the discounted prices to accumulate more tokens or sell in fear of further losses.
As of now, ADA is trading at $0.4493 after a correction in the past week, resulting in a 3% loss. With a market cap of $15.8 billion, Cardano is currently ranked 10th in the crypto market. This follows its brief displacement by Shiba Inu (SHIB) before reclaiming its top 10 position.
Despite the short-term bearish outlook, investors remain optimistic about Cardano’s long-term prospects. One potential catalyst for a bullish breakout is the approval of a Cardano spot ETF, which Ripple CEO Brad Garlinghouse believes is likely to happen after XRP.
Innovation on the Cardano network could also play a crucial role in its development, with co-founder Charles Hoskinson advocating for its potential to revolutionize financial markets.
Crypto analyst Alexander Legolas has provided some insight into the conditions that could lead to a breakout for ADA in June. According to Legolas, Cardano may need to secure a Stochastic RSI cross on the weekly chart, which has historically resulted in significant price increases.
If ADA can achieve this, it could see a 72% return, moving from $0.47 to $0.81. Bulls may even push the price further to reach $1, testing the next major resistance level.
For more information on Cardano and its features, you can explore our recommended resources, including a guide on buying Cardano, a tutorial on Cardano wallets, and the latest 24-hour Cardano price. Stay updated with the latest Cardano news to stay informed about the cryptocurrency’s developments.