Cardano (ADA) Surges 4.32% to $0.701 Amid Bullish Patterns

Cardano (ADA) has recently demonstrated significant momentum, with its price surging by 4.32% to $0.701, forming what analysts describe as a bullish engulfing candle. This upward movement coincides with Cardano founder Charles Hoskinson's efforts to dispel rumors surrounding a 318 million ADA transfer.

Over the past week, Cardano has been trading within a range of $0.67 to $0.72, with a firm support level at $0.65. Despite a 2% weekly decline, ADA has seen an 8% increase over the past month.

Technical analysis indicates that Cardano is forming an inverted head and shoulder pattern, which is typically bullish. This pattern is characterized by two swing lows at $0.682 and $0.557, with a recent turnaround from $0.226. The neckline of this pattern aligns with the 23.60% Fibonacci level near the $0.762 supply zone. For a confirmed breakout, Cardano needs to close above this neckline.

If a breakout occurs, price targets suggest a potential 40% rally toward the 50% Fibonacci level at $1.082. The Relative Strength Index (RSI) floating above the halfway line supports this bullish outlook. However, the Chaikin Money Flow (CMF) Index remains negative at -0.08, indicating some underlying weakness. A flip in the CMF Index would boost the chances of a breakout.

Recent controversy has arisen regarding Cardano’s governance. Masato Alexander alleged that Charles Hoskinson and Input Output Global (IOG) altered the Cardano Ledger by moving over 318 million ADA from unclaimed ICO vouchers to network reserves. Hoskinson strongly refuted these claims, stating that 99.8% of ADA vouchers were redeemed, with the remaining 0.2% lawfully donated to Intersect after a 7-year deadline. He has threatened legal action against those spreading what he calls rumors.

Blockchain analyst Jonathan Morgan supported Hoskinson, saying the allegations were misleading. Morgan clarified that the protocol upgrade was consensus-driven, not a unilateral rewrite. He also confirmed that over 300 million ADA were successfully returned to rightful claimants.

On a broader timeframe, a bullish flag pattern has been identified on the 3-day ADA/USDT chart. This continuation pattern formed after ADA reached its peak above $1.30 in late 2024. The pattern shows a descending channel movement from January 2025 until now, with resistance points at $1.30, $1.10, and $0.90. Support levels have held near $0.63, $0.60, and $0.56. If ADA breaks above the flag’s upper trendline, analysts project a target of $1.3387, representing an 89.18% increase from current prices.

Another analysis using Smart Money Concepts showed that ADA price returned to a demand area near $0.50 after rejection at a bearish order block. Support at the bullish order block triggered a rebalancing that pushed the price back above $0.70. Token Talk suggested $0.73 as a key resistance level. A break above this could trigger a rally to $1.00 in the short term, with longer-term projections much higher if momentum continues.

Derivatives market data aligns with these bullish technical signals. Data shows ADA’s open interest-weighted funding rate has stayed positive since mid-April. This indicates that long-position traders have continuously paid funding fees to short-position traders throughout this market phase. The steady increase in perpetual futures trading and rising open interest values demonstrate strong trader participation, with many taking leveraged long positions in anticipation of price appreciation.

Recent analyses from multiple traders have confirmed a breakout above a multi-month descending wedge. Volume confirmation and rising channel support suggest continued upward momentum for Cardano price. For now, Cardano trades above $0.70, with most technical indicators pointing to higher prices if key resistance levels can be broken.