Cardano, a cryptocurrency often referred to as ADA, is currently situated in a crucial demand zone between $0.37 and $0.38. Over 160,000 wallets have already acquired close to five billion ADA at this level, indicating strong support. If ADA manages to remain above this rate, it has the potential to reach new highs as the year comes to a close. However, should it lose this support, the token may experience a dip down to $0.34.
According to data from blockchain analytics platform IntoTheBlock, Cardano is positioned on a key demand zone. This zone holds great significance as it could pave the way for ADA, often considered a competitor to Ethereum, to achieve new yearly highs by the end of 2023. One analyst, known as Ali, emphasizes the importance of this price level and highlights that over 166,000 wallets have acquired a combined 4.88 billion ADA within the $0.37-$0.38 range. At current market rates, this amounts to approximately $1.82 billion.
Currently, ADA is trading at $0.3732, experiencing a 2.4 percent drop in the past day. However, it has maintained this price level over the course of the week. The trading volume has slightly increased to $287 million, and with a market cap of $13.2 billion, Cardano remains among the top 10 cryptocurrencies in the market.
The analyst suggests that if ADA manages to stay above the key demand zone, it could climb to new yearly highs. He notes the absence of significant resistance ahead and solid support below as factors that contribute to this potential upward movement. However, he advises caution, as losing the support level may trigger a brief correction down to $0.34.
Additionally, the analyst warns that losing the $0.37 support level could lead to further pullback. He points out that the Tom Demark (TD) sequential indicator has presented a sell signal on the weekly ADA chart. TD indicators are commonly used by analysts to anticipate potential turning points in an asset’s price. To advance towards $0.46, ADA must close above $0.40.
Regarding short-term trends, the analyst highlights the Tom Demark indicator’s buy signal on the four-hour chart. He mentions that the 100-EMA (exponential moving average) on this chart has acted as a rebound zone for ADA, while the $0.396 level has served as a strong resistance. To confirm the direction of ADA’s trend, he advises paying attention to a four-hour candlestick close above the $0.396 resistance or below the 100-EMA.
Institutional players in the cryptocurrency space consider Cardano to be one of the most significant digital assets. Its importance is expected to increase in the coming months, particularly with the launch of perpetual futures for ADA on Coinbase, the largest exchange in the United States. Perpetual futures allow traders to speculate on the future price of assets for an indefinite period of time. This development will make ADA accessible to a broader range of sophisticated investors with substantial resources.
Overall, Cardano’s performance in the market, its ability to stay above the key demand zone, and the launch of perpetual futures on Coinbase are all factors that will shape its future trajectory.