Cardano NVT ratio soared to its highest point since June, raising concerns about ADA’s price stability as on-chain activity slowed. This signal typically suggests potential overvaluation, making ADA’s recent struggles notable.
As Cardano’s price growth outpaced network activity, ADA investors questioned whether the price would rebound or drop further. Without a substantial rise in engagement on its blockchain, ADA could face challenges maintaining its current price levels.
Key Support Holding but Can it Sustain?
Recent data revealed that ADA has maintained a crucial support level on the weekly timeframe for over 100 weeks. This period has shown ADA consistently holding within a high-time-frame (HTF) support zone. Positioned at the base of an ascending channel structure, ADA’s current setup on the chart offers a promising yet cautious outlook.
Should ADA rise to the top of this channel, the move could result in over 200% gains. This price channel points to a potential “sleeping giant” opportunity, signaling that Cardano might experience a significant price surge if it successfully flips key resistance levels.
Traders closely monitoring ADA observed that it rested within a low-volume zone on the visible range profile, further supported by a bottom-of-channel position. This combination suggests that ADA could break out under the right conditions.
On the 6-hour chart, if ADA pushes through and flips its structure, it might open doors to favorable long entries, with potential gains to target levels identified within the chart. However, this optimistic scenario also faced limitations as ADA continued to show bearish patterns on the daily chart, where price action consistently trended downward.
The contrast between short-term and high-time-frame signals reflects ADA’s complex price outlook and emphasizes caution despite potential.
ADA/BTC Valuation Analysis
Notably, crypto analyst Benjamin Cowen accurately projected ADA’s recent struggles relative to Bitcoin’s performance. Cowen, known for his bearish perspective on ADA since August 2023, predicted that ADA would drop to 400 sats against Bitcoin, signaling declining strength.
Many traders initially dismissed his theory; however, his analysis proved prescient as ADA underperformed Bitcoin while BTC dominance climbed, now nearing 60%. With Bitcoin dominance increasing, the likelihood of further downward pressure on ADA remains.
If Bitcoin continues its upward trajectory, particularly as it tests new all-time highs, altcoins like ADA could face continued setbacks until Bitcoin stabilizes. Yet, this anticipated decline could set ADA up for a potential explosive run if and when Bitcoin dominance finally dips.
ADA’s current price levels present an appealing entry point for long-term investors who believe in Cardano’s future. The prospect of a more substantial rally would depend on favorable shifts in the broader market. With Bitcoin needing to clear $80,000 to relieve pressure on altcoins and enable ADA to gain momentum.
What to Expect From Cardano Price
Cardano’s position in the market remains a point of intrigue. Some traders are viewing ADA’s current lows as an opportunity to accumulate. As the crypto market’s dynamics evolve, Cardano’s technical setup suggests that patience might reward investors prepared for a longer-term hold.
If Bitcoin’s dominance does relax and broader altcoin interest rises, ADA could see renewed vigor. This potential sets ADA apart as an appealing investment for those who foresee its eventual recovery.
For now, ADA’s movement could largely depend on Bitcoin’s trajectory. Should Bitcoin surge and altcoins follow, ADA’s long-term investors could witness substantial returns. Though ADA’s near-term challenges underscore the need for a cautious approach.
