- Cardano development activity is expected to return to average levels after the holidays.
- Price action showed that a bounce from $0.535 is possible.
Cardano (ADA) suffered a major decline on January 3rd. This occurred with Bitcoin (BTC) falling from $45,800 to $40,800. Despite the short-term losses, ADA buyers were not overwhelmed by the weakness.
Conversely, prices were trading near the demand zone. The network performed well in 2023 and is likely to continue this progress in 2024. Here’s what the price chart shows:
Low range is important to buyers.
Source: ADA/USDT on TradingView
ADA has been trading within a range since December 14th, but this only became apparent a few days later. The range (purple) has expanded from $0.51 to $0.68.
The intermediate level of $0.595 has acted as a strong support level over the past two weeks.
The breach occurred on January 3 after Bitcoin suffered heavy losses and sent markets lower. This move also established the importance of the 4-hour bullish order block (turquoise box) at $0.535 for Cardano buyers.
At press time, H12 RSI was moving below neutral 50, reflecting bearish momentum in the market. OBV has been rising slowly since Christmas, but the bullishness has not been overwhelmingly strong.
Indicators showed strong selling pressure towards the end of the year.
Source: Santiment
The age consumption indicator rose significantly on December 27th. This marked a sharp decline during the ADA’s average money era. Together, they showed that large amounts of dormant tokens were being moved around and holders were selling their tokens.
Read Cardano (ADA) Price Prediction for 2023-24
Development activity has been high in recent months, but as expected, the festive season saw a big drop. It is expected that it will return to normal levels soon.
The social scale was also relatively high. Average coin age metrics are also starting to rise. Taken together, the ADA could see another northward move.
Disclaimer: The information presented does not constitute financial, investment, trading or any other type of advice and is solely the opinion of the author.