Cardano [ADA] has recently experienced a dramatic increase in whale activity, with $6.08 billion in large transactions reported over the past day. This surge, equivalent to a substantial $17.71 billion ADA, highlights a significant uptick in trading among major investors. However, this spike raises questions about whether caution is warranted.
As Bitcoin [BTC] remains in a consolidation phase, investors have shifted their focus to Cardano, which has seen a notable rise of over 10% in the past week. Despite this positive trend, data from IntoTheBlock reveals an intriguing development: large ADA holders have been taking profits, with approximately 219 million ADA moving to exchanges—a staggering 606% increase from the previous day.
This shift in activity comes as Bitcoin reached $58K and a key inflation index showed a 2.5% drop, boosting expectations for a potential rate cut. Consequently, the selling pressure on ADA may have been absorbed, leading to a 2% increase in ADA’s price to $0.3601 at press time.
Cardano’s recent surge can be attributed to several factors. The month began with the successful Chang upgrade, a significant step toward full decentralization. This upgrade led to a peak in daily active wallets, reaching approximately 40K—the highest in 180 days. Additionally, the launch of the Snek-Fun memecoin platform further stimulated network activity, with over 2,200 new coins created and $4.5 million in ADA trading volume on the first day.
These developments have contributed to a surge in ADA’s value, shifting around 200K addresses from loss to profit, now holding approximately $4 billion worth of tokens. This upward trend aligns with Bitcoin hitting $58K, while a drop in the inflation index supports expectations for a rate cut.
As Cardano bulls aim to push the price toward the $0.39 resistance level, the outcome will depend on several factors. The ability of ADA to reach this level hinges on the continuation of bullish sentiment, with whales maintaining their positions and short-term holders refraining from selling.
The market dynamics suggest that while a breakout to $0.39 is possible, a minor pullback could also be on the horizon. The 180-day mean coin age and the Market Depth Indicator Analysis (MDIA) have declined, indicating increased selling or profit-taking activity. If ADA’s price continues to rely on Bitcoin’s performance, any downturn in Bitcoin could result in a potential pullback for ADA.
Cardano’s recent price movements and increased whale activity signal a pivotal moment for ADA. Investors should closely monitor the behavior of major players and the broader market sentiment. While Cardano shows potential for further gains, especially with its recent upgrades and increased network activity, the likelihood of a pullback cannot be ignored. As always, staying informed and cautious will be key for investors navigating this volatile landscape.
September 2024, Cryptoniteuae