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Cardano’s price has reached the same consolidation point where it was stuck during H1 2023. Although the rally encountered a huge pullback, the current trade setup suggests the bulls may conquer the token shortly. The ADA price has been trading under immense bearish influence despite a healthy upswing in early 2024. The latest breakout suggests the selling pressure may have faded, but ongoing consolidation suggests there is more scope for a retest before the next bullish action.
To ascertain the probable bullish action, the whale accumulation plays an important role. The rise in the accumulation leads to an increase in optimism as more traders become hopeful of the upcoming trend. Hence, this leads to a notable growth in the buying volume, increasing the pressure and causing a healthy rise in the value. Unfortunately, the whales had constantly liquidated their ADA holdings, due to which the traders became pessimistic over the ADA price rally.
The above chart from Coinmetrics suggests the whales began to liquidate soon after the ADA price faced rejection from the yearly highs. However, the wallet count holding more than a million tokens has surged back above 1150 after falling below 1000 for a while. This increased whale activity may build more confidence among the market participants and also the rising bullish momentum may add fuel to the fire.
On the other hand, the daily active addresses have dropped in the past few days, which suggests the bears may have taken out their profit. A significant drop in the selling pressure may be expected in the coming days, which may elevate the ADA price beyond the current consolidation zone. However, before doing so, another 8% to 10% pullback could be fast approaching, which may completely remove the selling pressure.
As seen in the above chart, the ADA price has been trading within a falling wedge, and after a breakout, it is consolidating. The MACD shows a drop in the buying volume, but the selling pressure has not yet piled up. Besides, the RSI is neutral and is holding around the highs, suggesting the continuation of a bullish trend. Therefore, the Cardano (ADA) bulls appear to be relaxing a bit as major price action has yet to begin.
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