Cardano (ADA) has been consolidating in a tight range between $1.12 and $1.24 for over a week, with the price currently testing a crucial resistance level at $1.25. Experts suggest that ADA’s next significant price movement will depend on whether it can break out above this level or will face a breakdown below the lower boundary of the consolidation zone.
If ADA successfully breaks above $1.25 and closes a daily candle above this level, analysts predict a potential 50% surge. This could push the altcoin’s price to $1.90, signaling a strong bullish trend in the coming days. The current Relative Strength Index (RSI) for ADA stands at 64, suggesting that the altcoin is not yet overbought territory, leaving room for further upward movement if the breakout happens.
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Increased Whale and Institutional Interest Support Bullish Outlook
A significant factor supporting ADA’s bullish case is the strong interest from whales and institutional investors. Looking at the exchange balances, data obtained from Coinglass show that exchanges have seen an outflow of $129 million worth of ADA since December. This outflow means more investors are trading their ADA coins on exchanges for warmer wallets, a positive sentiment for this altcoin.
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Source: Coinglass
This rising institutional interest added to the fact that more outflow is likely to enhance the probability of a price rally. So, the more investors purchase ADA, hoping for a rising price in the future, the more positive sentiment there is around the digital asset.
Breakdown Below $1.12 Could Lead to 20% Decline
However, Cardano is not without risks, as a failure to maintain support at the $1.12 level could trigger a sharp decline. If ADA breaks below this key support and closes a daily candle under $1.12, it could see a 20% decline, with a potential price target of $0.92. This scenario would signal a bearish shift in market sentiment and could lead to further losses in the short term.
ADA is trading at $0.96 at the time of writing, marking a 12.36% drop in the past 24 hours. As ADA navigates these crucial levels, traders and investors will be watching closely to determine whether the altcoin can sustain its bullish momentum or if it will face further pressure in the coming days.
Source: CoinMarketCap
FAQs:
1. What is Cardano’s price prediction for December 2024?
If Cardano breaks above $1.25, it could surge by 50%, reaching $1.90.
2. How has institutional interest impacted Cardano’s price outlook?
Institutional interest and a significant $129 million outflow from exchanges support a bullish outlook for Cardano.
3. What could happen if Cardano’s price falls below $1.12?
If ADA breaks below $1.12, it could decline by 20%, potentially reaching $0.92.
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Kelvin Munene
Kelvin Munene is a dedicated crypto-economic analyst and blockchain enthusiast, driven by a passion for demystifying decentralized technologies. With a deep understanding of blockchain, cryptocurrencies, and digital tokens, Kelvin writes for leading publications to help individuals and businesses unlock the transformative potential of these technologies. His mission is to empower people with knowledge about how decentralized systems can reshape economies, enhance financial freedom, and create a more inclusive and transparent digital future.