“It has to stop somewhere, doesn’t it?”
This is the question that most of the crypto ecosystem has been asking since Cardano cracked $ 2. Okay, maybe not the Cardano community, but the rest of the market.
Now the altcoin can simply lose a lot of steam at one point in the price charts. So what? If Cardano sees the corrections due, these particular price zones could be reasonable areas of support. In fact, either of them can keep the long-term narrative bullish for the altcoin.
Cardano a week; To reach the climax?
Since the beginning of 2021, Cardano’s weekly increase has been enormous. The asset has continued to gain strength over certain time periods, but has always hovered around its 20 simple and exponential moving averages.
After each high, the price fell to the MAs before rising again. This could be the case in the future, as the printing time market appeared to be supported by relatively lower volumes on an annual average.
Well, in terms of profitability, none of the traders should be complaining. At the time of writing, 95.90% of the addresses were in the money which is amazing.
But it also feeds the notion that sales incentives are now greater. If investors are collectively profitable on paper, there must be sellers to make real profits.
But why are the dealers going to sell?
Instead of asking why the traders are selling, it is more important to look at the classification of these traders. According to the attached data, the ongoing rally is being supported by traders who have held ADA for less than a year. These addresses can be considered retail as longtime traders started exiting markets in May.
From this it can be concluded that most of these traders have on average already had more than 5 to 6 times the return since the beginning of 2021. The incentive has never been so lucrative in the short term.
Dealers sell, but what then?
Now that the foundation for a correction is in place, these levels of support for activity and volume are basically correct. Surprisingly, the total volume of ADA is between $ 1.74 and $ 2.57, 4.84 billion ADA, currently amassed by 279,000 addresses. As a result, an immediate correction range for Cardano will fall around the $ 2 mark.
In the long term, the next strongest volume range will be between $ 1.24 and $ 1.55 and register 4.65 billion ADA tokens.
However, such a massive decline is not expected at the moment as the sales pressure from whales is decreasing across the industry as a whole.