Cardano price staged a strong rally on Friday, reaching its highest level since June 11. It has jumped in the last four consecutive days, mirroring the performance of the broader crypto market. This article explores what to expect in the coming weeks.
Cardano price technical analysis
The daily chart shows that the ADA price bottomed at $0.5085 and then bounced back. Its lowest level this week coincided with the lowest point in April this year, meaning that it has formed a double-bottom pattern.
A double bottom is one of the most common bullish reversal patterns in technical analysis. It has now moved above the 50-day and 200-day Exponential Moving Averages (EMA).
More technical indicators point to more gains in the coming weeks. For example, the Average Directional Index (ADX) has continued rising as it remains above 20.
The token has moved above the Ichimoku cloud and the Supertrend. Therefore, the path of the least resistance for Cardano is bullish, with the next point to watch being at $0.8360, the neckline of the double-bottom pattern.
A move above that resistance level will point to more gains, potentially to the psychological point at $1. A move below the support level at $0.60 will invalidate the bullish outlook.
Why ADA price is surging
There are a few reasons why Cardano price is in a strong bull run. First, the rally has coincided with the ongoing Bitcoin price surge. Bitcoin soared to $118,000 for the first ever, and analysts expect the trend to continue.
Bitcoin has soared because of the rising demand from American investors, who have piled into their ETFs. Cumulative ETF inflows soared to a record high of over $50 billion, with the IBIT ETF’s assets jumping to over $80 billion. This trend means that this fund will soon surpass the 20-year-old GLD ETF.
Cardano price has also jumped as data points to a rebound of some of its assets. For example, Snek, the biggest meme coin in the ecosystem has continued soaring this week, with its market capitalization jumping to over $200 million.
More data shows that the decentralized exchange (DEX) volume in Cardano has jumped to the highest point in over a week. Still, Cardano’s ecosystem is significantly smaller than other blockchains.
Further, there are signs that the Securities and Exchange Commission (SEC) will approve the spot ADA ETFs later this year. Such a move will lead to more inflows in the coming months. For example, spot Bitcoin and Ethereum ETFs inflows have jumped sharply in the past few months.
Cardano’s futures open interest has continued rising, a sign of rising demand among investors.
Meanwhile, Cardano is preparing the upcoming Glacier airdrop, where its holders will receive NIGHT tokens.
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