- ADA stalled temporarily at the $0.787 resistance but retained its bullish momentum and structure.
- The decrease in speculator conviction suggested a bearish sentiment could be taking hold.
Cardano [ADA] saw a breakout past a key resistance level a week ago. AMBCrypto reported that the memecoin market on the Cardano network could see an increase in activity and new users on the network, which would be a positive outcome.
From a technical analysis perspective, ADA is expected to rally toward the psychological $1 mark. On the other hand, some key metrics suggested that buyer dominance has begun to wane.
The demand at the range highs was encouraging
Source: ADA/USDT on TradingView
The 12-hour price chart above showed that the market structure was bullish. The RSI was at 58.5 at press time and showed that while momentum had slowed down in recent days it still favored the buyers.
The OBV agreed. While it saw a sizeable dip on the 4th and 5th of March, it has bounced back strongly in the days that followed. As long as the indicator does not drop below the recent low, the buyers would be considered the dominant party.
The $0.787 and $0.917 are the key resistance levels to watch out for next. Based on the width of the range that ADA traded in over the past three months, a move to the $0.917 level is anticipated.
Beyond that, the $1 and the $1.24 levels were the next HTF resistances.
The waning Open Interest suggested a potential shift in sentiment
While the price action and technical indicators outlined strong bullish pressure, Santiment metrics were not as optimistic. The mean coin age has been declining since mid-February even though prices rallied.
The inference was that holders have been moving tokens around a lot, potentially for selling purposes. This lack of faith could hurt ADA’s chances of rallying higher quickly.
How much are 1, 10, or 100 ADA worth today?
The MVRV ratio showed holders were in profit as ADA made new local highs. However, the Open Interest has trended downward in the past two weeks.
Combined with the mean coin age, the lack of speculator conviction indicated ADA could have a hard time rallying to $0.91 until these factors shift.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.