Cardano (ADA) Price Soars By 5% As Buying Pressure Mounts

The Cardano (ADA) token marked a two-year low at $0.239 as recently as December 30 but has since experienced a sustained upswing that catapulted the price to $0.264 at press time. Within the last 24 hours, ADA is recording an increase in price of around 5%, with a trading volume of around $250 million.

However, a look at the 1-day chart reveals that Cardano is far from out of the woods. The ADA price has been in a falling trend channel since mid-August 2022. Since early December alone, the ADA token has fallen 25%.

While the 50-day simple moving average (SMA) is an initial target at $0.291, ADA needs another boost above $0.33 to break out of the bearish trend. Thus, today’s move could mark a budding momentum for the bulls. The MACD indicator was showing a bullish crossover a few days ago, suggesting buying pressure is building up.

Meanwhile, the Relative Strength Index (RSI) is currently at 46 and is now in neutral territory after spending much of the second half of December in oversold territory.

Looking at the 4-hour chart, Cardano has seen a major rejection at the key resistance zone of $0.266-$0.271. For ADA investors, the mark could be the first major step to tackling the $0.28 level. After that, the most crucial resistance would be waiting in the $0.291-$0.30 zone. Only if Cardano manages a breakout, the attention could move to the higher time frame, setting up a final strike against the bearish trend.

Cardano Whales And DeFi Activity Could Spur The Price

Some upside to the ADA price may have been provided by the growth of the Cardano DeFi ecosystem. After hitting a low of $48.95 million on January 1, Total Value Locked (TVL) has risen again today to $52.53 million according to data from DeFiLlama.

Some of the leading decentralized financial protocols on the Cardano network have seen an uptick in activity. Within the top 7  decentralized applications (apps), all have seen at least a 3.5% increase over the last 24 hours in terms of TVL. With +21.5%, Lending Pond leads the growth over this period, but also over the last month (+50%).

Another reason for the uptick in price could be larger ADA investors. WhaleStats data shows that large BSC holders also have a keen interest in buying Cardano (ADA). ADA purchases are within the top 10 of the 4,000 largest BSC whales in the last 24 hours. In addition, the largest BSC whales currently hold 19.9 million ADA, which is worth $5.19 million and represents 0.68% of the total supply.

Featured image from IOHK Blog, Charts from TradingView.com