The Cardano network has seen a notable growth in whale activity recently, meanwhile, the behavior of short-term traders and whales suggests that some investors may begin to sell. The price of Cardano (ADA) has risen, but it is unclear whether it can stay afloat.
Cardano (ADA) holders are preparing to take profits
Cardano’s growth has slowed since the rally that occurred at the end of January: the price was not able to overcome the important resistance level of $0.76.
The supply distribution, which was largely concentrated among medium-term holders (addresses holding coins for one to 12 months), has also changed significantly.
Thus, short-term traders sharply increased their ADA holdings. These investors, who have held tokens for less than a month, typically buy and sell them quickly, fueling price volatility .
In the case of ADA, their share increased by 12.9% to 18.4% over the past month. This leaves Cardano vulnerable to potential sales from these market participants.
Whales Activity
The whales also began to show signs of recovery. Although they account for less than 9% of the total circulating supply of ADA, they account for approximately 90% of all transactions on the network. Thus, over the past week, the total volume of transactions reached $30 billion, with whales accounting for $25 billion.
A surge in activity from large investors could be a signal that they plan to take profits before Cardano’s price begins to decline.
ADA price forecast: hope for growth remains
The price of Cardano has slowed down and all signs point to the possibility of a price decline. The token has been testing the resistance of $0.78 for a week now and cannot break through it. If it fails to overcome this barrier, it will likely return to $0.68 or fall to the $0.63 support, where it will find a bottom.
However, the relative strength index (RSI) is still in the green zone. As long as it remains above the neutral 50 line, ADA has a chance to recover. A break above $0.74 will confirm the possibility of a bullish scenario, while $0.76 becoming a support zone will invalidate the bearish forecast.
About Cardano
Cardano is one of the most popular cryptocurrencies and ranks 8th in terms of market capitalization acording to coinmarketcap. The project is a decentralized public blockchain, the main goal of which is to protect user privacy, as well as easy modernization so that the system can quickly develop. Cardano is a multi-layer protocol; the settlement layer is responsible for computational functions, and the control layer runs smart contracts and enforces network requirements.
Cardano strives to improve scalability, security, governance and compatibility with traditional financial systems and regulations, improving on the experience of other projects, Bitcoin and Ethereum. An important difference from Ethereum and many other cryptocurrencies is that it is a blockchain project developed with a scientific “philosophy” the team includes scientists and engineers.
