Trump's Crypto Reserve Boosts ADA Price by 60%
1min read Cardano's (ADA) price has surged following the announcement of a U.S. Crypto Strategic Reserve by President Donald Trump, sparking market speculation and raising questions about the sustainability of this momentum. This rapid price increase has traders divided on whether it signals the start of a bullish trend or merely a temporary spike.
Trump's announcement of the strategic reserve has sent shockwaves through the cryptocurrency market, particularly benefiting Cardano. The initiative aims to bolster the industry after Trump's criticism of what he termed "corrupt attacks" by the Biden administration, fostering optimism among crypto enthusiasts. Initially, Trump included XRP, Solana, and Cardano in the reserve, while notably excluding Bitcoin (BTC) and Ethereum (ETH). This omission stirred considerable speculation about the future roles of these major cryptocurrencies, leading to a rapid influx of investments into ADA.
In the wake of the announcement, Cardano saw its price soar nearly 60%, as traders clamored to capitalize on potential gains from this strategic initiative. The trading volume erupted as new investors entered the market, igniting hopes for a sustained bullish trend. Technical analysis illustrates ADA's ascent through critical moving averages, a strong indication of the intensified buying activity. Indicators such as the RSI surpassed the 70-mark, commonly associated with overbought conditions, while the MACD histogram showed positive momentum, reflecting bullish sentiment from the market participants.
Data from Santiment revealed a substantial uptick in transaction volume along with increased activity from larger investors, especially post-announcement. This surge included whale movements, with transactions exceeding $1 million indicating a keen interest from institutional and high-net-worth investors. However, after peaking, profit-taking grew evident, leading to increased selling pressure on ADA. This behavior highlights the market's volatility and the cautious stance many traders are adopting as they navigate these rapid price shifts.
After the announcement, the open interest in ADA futures skyrocketed beyond $1.2 billion, indicating a swift influx of speculative capital and a notable uptick in bullish sentiment resulting in price movement towards $1.20. Nonetheless, market indicators, particularly the funding rate, lean towards a negative bias as many short traders position themselves for a potential price correction. This dynamic creates a scenario where a short squeeze could occur if bullish conditions continue to hold, adding a layer of unpredictability 