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Cardano has been in the spotlight of the cryptocurrency market following the recent developments around its Shelley incentivized testnet. Last week, for instance, the team behind IOHK gathered a small group of operators to provide insights on how the Shelley mainnet would look like.
Charles Hoskinson, the CEO of IOHK, said that from a “QA perspective,” the testnet has been “tremendously successful” thus far. The co-founder of Ethereum stated that the “pioneers” have been working through a series of exercises that have been essential for the firm to understand the challenges that stake pool operators will have with the upcoming upgrade.
Hoskinson also disregarded doubters and affirmed that there is no way Shelley will not launch in 2020.
As speculation mounts in anticipation of the Shelley hardfork, the price of ADA continues to reach higher highs.
Cardano Faces Strong Resistance Ahead
The smart contracts token saw its price hit $0.055 today for the first time since late February. The bullish momentum came after ADA was consolidating within a narrow trading range for the past five days.
Now, it seems like buy orders behind Cardano are piling up, which could lead to a further upward advance. Yet on-chain data reveals that there is a significant resistance barrier ahead.
IntoTheBlock’s “In/Out of the Money Around Price” (IOMAP) model shows that 2,700 addresses bought nearly 2.5 billion ADA between $0.056 and $0.057. Such a massive supply wall may have the potential to put a stop to Cardano’s uptrend.
While the number of tokens being held around the resistance level mentioned above is a sign of strength, the IOMAP indicates that after this hurdle ADA may be able to shoot up. In fact, moving past this barrier may increase the odds for Cardano to move towards the next significant resistance that sits between $0.077 and $0.12.
Most Investors Are Comfortable Holding ADA
This fundamental index also reveals that 71.3% of all addresses holding ADA are currently “In the Money.” Since their average entry price is lower than the current market price, they will realize a profit if they were to sell their holdings today. With such a vast number of investors and market participants alike in the green, there is a lot of confidence about Cardano’s future price action.
Nevertheless, it is worth mentioning that adverse conditions always have to be taken into consideration. The unpredictability of the crypto market is a reason to look at the other side of the coin before entering any positions.
The IOMAP shows that the support zone between $0.046 and $0.050 may hold in the event of a retracement. Here, there are approximately 25,000 addresses that bought nearly 7 billion ADA. This area of high demand would likely prevent ADA from a steeper decline if the selling pressure behind it were to increase.
Featured Image from Unsplash
