Does a shaky 1920’s stock market mean you view your wealth as a little riskier? Before you hoard all those Benjamins under a mattress, you should buy them Cardano (CCC:ADA USD).
Today, let’s look at Cardano both off and on the price chart and why the top-tier digital asset offers a solid looking opportunity to diversify investors’ portfolios.
As the adage popularized by CNBC’s Jim Cramer teases, there’s always a bull market somewhere. And it’s true, although some like Cardano are bulls in bear clothes. But that’s to the investor’s advantage for now.
ADA and the bear crypto market
While Wall Street’s large-cap, blue-chip ATM may finally come to terms with its historically inflated metrics, Cardano is down as much as 55% from its peak valuation from early September.
That’s right – a real bear market and real “roar!”
The severity of the Cardano bear market, should it materialize Microsoft (NASDAQ:MSFT), home depot (NYSE:HD) or another top-tier stock, would have ambulance-hunting attorneys filing class-action lawsuits for personal injury and battery claims faster than you could calculate one Tesla (NASDAQ:TSLA).
Of course, the ADA coin is not alone in its misery. Popular and well-traded cryptos — regardless of market cap, token capabilities, or meme-like status — have flipped it on its head and are uniformly in bear market territory.
Bitcoin (CCC:BTC USD)? Check. ether (CCC:ETH USD)? Dito. Shiba Inu (CCC:SHIB USD)? A well-deserved “wow wow”. You understand it.
The outlook for Cardano
But the other point is that not all cryptos are created equal. And much like the stock market, some digital assets have a lot more in their favor than others — at least, that’s what we’re told.
To be fair, and for most of us who simply trade cryptos like Cardano, it’s too early to declare the market’s long-term winners or those who are ultimately doomed to become pink leaf-like obscurity. It’s not a knock, but a significant leap of faith is taken compared to investing in the stock market with its imperfect information.
Still, and according to connoisseurs, there is a difference between tokens that allow you to buy items of real value, such as: B. a pizza, and a purely speculative, non-fungible token (NFT). Cardano appears to be an early forerunner for decentralized finance (DeFi) market share, putting it closer to the former category.
Alonzo’s smart contract upgrades this fall gave Cardano a reputation as an “Ethereum killer.” Now, with a new Metaverse application called Pavia and the launch of decentralized exchange SundaeSwap today, there’s far too bullish to consume with ADA.
Cardano weekly price chart
Source: TradingView charts
I’m still waiting to digest the news of a confirmed pizza transaction before diving into another crypto. But it has a valuation of $45 billion, making it the fifth largest crypto by market cap. Cardano is about as serious as they come.
Sure, ADA isn’t in the same league as Bitcoin’s $819 billion or apples (NASDAQ:AAPL) estimates at $2.76 trillion. But Cardano compares to impressive risky assets like China no (NYSE:NEVER), zoom (NASDAQ:ZM) or human (NYSE:TO HUM). Today it turned around even in a bear market.
This week, the top crypto confirmed a engulfing bottom candle formed around a key price band. It has Fibonacci support from around $1.20 to $1.55. A buy right now also has support from a well-aligned stochastic breaking out of oversold territory.
The bottom line is that I can’t promise Cardano investors a rose garden — or a pizza, for that matter. Promisingly, however, a purchase could always turn into a more history-making investment. It could be like buying AAPL or HD stock in the single digits as each started to build their own formidable empires.
At the time of publication, Chris Tyler holds positions (either directly or indirectly) in Grayscale Bitcoin and Ethereum trusts (GBTC and ETHE). The opinions expressed in this article are those of the author and are subject to InvestorPlace.com’s publicity guidelines.
Chris Tyler is a former listed futures market maker on the American and Pacific stock exchanges. Follow Chris on Twitter @Options_CAT and StockTwits for more market insights and related reflections.