Cardano's 80% Surge: Time to Buy ADA?
1min read Cardano's price has surged by over 80% in the past 24 hours, leading some investors to consider buying ADA. However, several factors suggest that now may not be the optimal time to enter the market.
Firstly, the recent rally was fueled by news of ADA's potential inclusion in a US crypto strategic reserve. However, this initiative still faces significant hurdles. President Trump's executive order requires Congressional approval to borrow money or revalue the gold price higher, which would be necessary to fund the purchase of digital assets for the reserve. Without this approval, the market may experience a sell-off, potentially leading to a decline in Cardano's price.
Secondly, whale activity indicates a lack of confidence in the sustainability of the current momentum. Large ADA addresses holding between 10M and 100M tokens reduced their holdings by 110M tokens during the rally, suggesting that they likely sold as the price surpassed $1. This bearish signal could weaken the current momentum and trigger a price reversal.
Lastly, Cardano's price has reached overbought levels, and the RSI line is tipping south, indicating waning buyer interest. The fading MACD histogram bars also suggest that buyers are leaving the market, increasing the risk of further downside. If selling activity continues and Cardano's price loses its current support at $0.97, it could trigger another decline to the next support levels of $0.81 and $0.65.
Despite these bearish signs, ADA price could still rally later this week due to the White House Crypto Summit. Traders should brace for volatile swings in Cardano's price during the week. In conclusion, while Cardano has experienced significant gains, the current market conditions and whale activity suggest that it may not be the optimal time to buy ADA.
