The cryptocurrency market is reviving, and altcoins like Cardano (ADA) are showing signs of recovery. A detailed analysis by “S_CAPITAL” on TradingView highlights a potentially lucrative trading opportunity for ADA.
Falling Wedge Pattern Signals Reversal
The daily chart for ADA reveals a bullish falling wedge pattern, characterized by two converging trendlines sloping downwards. This pattern typically signals a potential bullish reversal. As ADA’s price narrows within this pattern, a breakout to the upside seems imminent. Historically, such patterns have a high success rate, making this setup attractive for traders.
Strong Support Levels
Cardano has consistently found support in the $0.35 range, bouncing off these levels multiple times. The analyst identifies favorable entry points for Cardano at $0.4063, with a stop loss below $0.3096 to limit downside risk. The chart displays a risk/reward ratio of 3.11, indicating that the potential reward is more than three times the risk. The trader targets the $0.72 price point following a successful breakout rally, representing a potential upside of approximately 76.10% from current levels.
RSI Indicates Bullish Divergence
The relative strength index (RSI) at the bottom of the chart shows a bullish divergence. Despite the price moving downwards, the RSI has been trending upwards, suggesting that selling pressure is weakening. This divergence often precedes a price reversal, adding further weight to the bullish outlook.
Whale Activity Bolsters Bullish Sentiment
Cardano has seen a significant surge in inflows, indicating large holders are accumulating. According to data from IntoTheBlock, whale addresses saw an inflow of 5.14 billion ADA, valued at $2.1 billion, on July 22. This influx represents a 10,878% increase from the day before. Over the past week, inflows to large holders’ wallets have surged by 22,768%, and the past month has seen a 172,952% rise. This dramatic increase in large holder inflows is largely attributed to concentrated accumulation by whale investors.
Current Market Status
As of now, Cardano is priced at $0.3902, experiencing a 6.82% decline in the last 24 hours and an 11.54% decline over the past seven days.
