Holders of Cardano [ADA] saw a ray of hope as ADA ended the week strongly. Given the substantial drop ADA has experienced in recent weeks, the positive price movement was a pleasant relief.
But a different story emerged from the volume chart, raising questions about how long the current trend will last.
Cardano has a great week-ending
A close week was had by all, according to a daily timeframe analysis of the Cardano price chart. On April 20, ADA saw a rise of about 8.3%, ending the day at about $0.5.
This spike signaled the conclusion of the long uptrend that started on April 18 and offered some relief from the sharp drops that had been seen during the previous week.
As of the writing of this article, ADA was slightly up more than 1.5% and was still trading in the $0.5 region. But even with the back-to-back gains, ADA was still firmly in a bear market pattern.
Analysis of the Relative Strength Index shows that it stayed below the neutral line, indicating that the price movement is currently not showing any signs of bullish momentum.
Cardano volume exhibits non-convergence
There is a discrepancy between traders' activity and price change, according to an analysis of the Cardano volume. The volume did not show the same level of excitement and has not crossed the $500 million threshold, even with the upward price trend.
The volume has decreased by more than half since it peaked at over $1.3 billion at the start of the week. Approximately $402 million was the volume as of this writing.
This difference points to a possible lack of sustainability in the price rise by implying that price and volume are not convergent.
A lack of trader engagement, which is essential for maintaining price increases, is implied by the stagnant volume. The present price trend might be able to hold momentum with more volume.
Interest in ADA is somewhat increasing
A look at Coinglass's Cardano Open Interest showed a significant drop in recent days. At the time of writing, there has been a little increase, but it has not yet been able to recover earlier levels.
The Open Interest as of this writing was approximately $207.8 million, a considerable decrease from the almost $400 million recorded around April 10. The Open Interest trend shows a decline in the influx of cash into ADA.
April 2024, Cryptoniteuae