Cardano Rebounds but Faces Structural Resistance
Cardano’s price is starting to rise again, going up almost 2% on Friday after going up 3% the day before. Even with this rise higher, ADA is still stuck in a descending triangle formation on the 4-hour chart, which means that bullish momentum may not be strong enough yet.
The token’s short-term path is unclear since technical resistance around the top of the triangle keeps it from going up. Analysts say that Cardano’s recent advances may not be able to turn into a long-term trend reversal without more follow-through purchasing pressure.
Whale Activity Shows Divided Market Sentiment
On-chain data shows that the biggest investors in Cardano, who are sometimes called whales, act in different ways. Wallets with more than 1 billion ADA have added a little to their holdings, bringing them to 4.33% of the entire supply. This shows that top-tier holders are selectively building up their holdings.
But mid-tier whales that possess 100 million to 1 billion ADA have cut their exposure by a lot this month, losing 56 percentage points of their holdings. This difference shows that significant investors don’t all agree on Cardano, which makes it hard to know if it can keep going up in the foreseeable future.
Cardano Futures Show Caution as Open Interest Holds Below $700 Million
The futures market shows more prudence than excitement. According to CoinGlass, ADA’s open interest is at $660.9 million, which is a little increase from Thursday but still below the $700 million mark.
The low level of leverage involvement shows that traders are taking a wait-and-see attitude after the dramatic drop from $1.51 billion earlier this month. Flat open interest means that most people are staying away from making big directional bets and are instead being careful until they see clearer signs of momentum.
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Technical Setup Suggests Potential Breakout Opportunity
The 4-hour chart for Cardano shows a bounce off of local support inside the descending triangle, which may mean that the coin is getting stronger in the short term. The token is presently having trouble getting over the 50-period Exponential Moving Average (EMA) at $0.655, which is a critical level that has to be broken through for more gains.
If ADA can close clearly above the central pivot point at $0.660, experts think it will break out toward the R1 resistance at $0.728. This kind of rise would reaffirm bullish momentum and could draw in traders who have been sitting on the sidelines waiting for confirmation.
Cardano MACD Crossover and Rising RSI Signal Renewed Bullish Momentum
The Moving Average Convergence Divergence (MACD) indicator is sending good signs. The MACD line is crossing above the signal line, and the histogram bars are getting bigger. This alignment shows that purchasing pressure is getting stronger and may be the first sign that the trend is starting to rebound.
The Relative Strength Index (RSI) reading of 53 also shows that Cardano is getting back some mild positive momentum. As the RSI rises above the middle, traders may see this as a sign that sentiment is getting better over shorter time frames.
Downside Risks Stay Despite Attempts to Bounce Back
Indicators imply that things are getting better slowly, but Cardano’s descending triangle structure has built-in hazards if bullish attempts fail. If prices close below $0.606, selling pressure might rise again, pushing prices down to the S1 support level at $0.584 or potentially the S2 level around $0.516.
This situation would confirm the bearish trend that is common in descending triangles and might make ADA’s consolidation phase last longer. For the present, the token’s technical health rests on keeping its support base and gaining enough impetus to break the larger bearish pattern.
Cardano Awaits Market Turn to Regain Momentum and Overcome Resistance
The mood of the market for key cryptocurrencies has a big impact on Cardano’s near future. ADA might fall behind its peers during the next crypto recovery phase if there isn’t a lot of retail activity or steady whale accumulation.
Cardano might yet get back on track and break out of its triangular formation if the market as a whole becomes more positive and trade volumes rise. In the next few trading days, it will be very important to see if ADA confirms a bullish reversal or is stuck in a range because of technical resistance.
