The crypto market experienced renewed selling pressure this week as Bitcoin retreated from $70,000, triggering corrections across altcoins including Cardano. However, analysts suggest holding onto ADA may be prudent given current market signals.
During Friday’s Asian trading, ADA dipped 0.8% to $0.34, with its market cap falling to $12 Billion. The price is currently retesting support from a bullish pattern, indicating potential for reversal amid positive on-chain metrics.
Crypto analyst Deezy.eth recently highlighted a notable pattern in ADA price action that has historically preceded major recoveries. Analysis of 3-day Heiken Ashi candles with RSI shows that near downtrend bottoms, ADA often displays higher RSI slope formations. This bullish divergence typically signals buyers entering at discount levels, potentially triggering new upward moves.
Historical data from December 2018 and March 2028 demonstrates significant reversals following such RSI divergence patterns, with one instance leading to ADA’s all-time high of $3.1.
Cardano is also making strategic advances, integrating with the Bitcoin ecosystem through BitcoinOS (BOS). This opens up access to over $1.3 trillion in Bitcoin liquidity for Cardano’s DeFi landscape, utilizing BOS’s Grail bridge for secure, trustless BTC transfers via zero-knowledge cryptography.
The case for a bullish reversal gains further support as the 30-day Market Value to Realized Value ratio (MVRV) enters negative territory at -5.1%. This indicates short-term traders are experiencing losses, which historically leads to panic selling from speculative positions while attracting long-term investors – a transition that has previously benefited ADA prices.
Technical analysis shows ADA declined from $0.369 to $0.34 over three days – a 7.4% drop. This move threatens support of a triangle pattern formed since mid-July. A daily close below support could trigger a 13% decline toward $0.3, where psychological support and a long-term trendline may encourage buyers to return.
However, if the triangle support holds, ADA could surge 14% to test the pattern’s upper boundary. A breakout from this accumulation phase would be crucial for potential new all-time highs.
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