Cardano (ADA), an established competitor to Ethereum, has recently experienced a notable surge in its market value. However, recent on-chain metrics from Santiment, a leading crypto intelligence tracker, suggest caution among ADA investors. Despite a strong performance in the past month, there are indications that the currency might face a downturn due to increased profit-taking activities among holders.
The data reveals a significant increase in profit-taking since December 4, coinciding with heightened activity in large wallet transactions. Notably, transactions from whale wallets, defined as those over $100,000, have seen a marked increase in both count and concentration during this period. This trend is evident in the Network Realized Profit/Loss metric, which spiked in December, indicating that large ADA holders are cashing in on the recent rally.
As of the current analysis, Cardano’s price has sustained above the critical support level of $0.50. However, analysts anticipate that ADA might resume a downward trend upon reaching the resistance level of $0.6874. The $0.5063 mark could be a crucial support level in such a scenario. Furthermore, three long-term Exponential Moving Averages (EMAs) – 10-day, 50-day, and 200-day – at $0.4566, $0.3893, and $0.4437, respectively, are also expected to offer support.
Today, Cardano’s price is $0.616007, reflecting a 0.50% increase over the last 24 hours and a 3.40% decline over the past week. With a circulating supply of 35 billion ADA, the cryptocurrency currently boasts a market capitalization of $21,532,800,684 and a 24-hour trading volume of $1,043,681,072.20.
Investors and traders in the Cardano market should approach with caution, considering the potential for a correction. The increased profit-taking activity and the movements of large-scale holders are critical factors to monitor. While ADA has shown resilience, the looming possibility of a price correction suggests a need for a strategic and well-informed investment approach.
