The rise in the altcoin market last week helped Cardano gain value. At the time of writing, ADA was trading at $0.42, achieving a 22% increase in the last seven days. At its current value, the altcoin is at its highest price level in recent times. Cardano’s double-digit price increase last week allowed some holders to make a profit.
Why is Cardano Rising?
According to the seven-day moving average, ADA’s on-chain transaction volume returned a value of 1.05 based on the daily profit/loss ratio. This data measures the ratio of profitable and unprofitable daily transaction volumes of an asset. A ratio greater than 1 indicates trading with profit rather than loss and generally signals positive market sentiment. Conversely, when the value of the data is below zero, it indicates that the volume traded with loss is greater than that traded with profit.
ADA’s 1.05 ratio shows that for every transaction resulting in a loss last week, there were an average of 1.05 transactions that were profitable. This means there were more profitable transactions than those resulting in a loss. Additionally, ADA’s rising Relative Strength Index (RSI) indicates that the price increase is supported by genuine demand for the cryptocurrency. The data, at the time of writing, is in an upward trend and stands at 53.66.
RSI measures overbought and oversold market conditions of an asset. It ranges from 0 to 100; values above 70 indicate the asset is overbought and likely to decline, while values below 30 suggest the asset is oversold and may witness a recovery. At 53.66, ADA’s RSI data shows that buying pressure is increasing and starting to outpace selling activity.
ADA Chart Analysis
ADA’s 22% price increase last week pushed its price above the 20-day exponential moving average (EMA). This measures an asset’s average price over the last 20 trading days, and trading above this significant moving average indicates an increase in buying pressure.
ADA is currently moving towards the 50-day simple moving average (SMA), which is a bullish signal. If ADA successfully surpasses this, it will indicate that the recent average price is higher than the long-term average, confirming the potential for further price increases. In such a case, ADA could trade above $0.43. However, if a decline occurs, ADA’s price could drop to the $0.38 level.
