After examining the Mean Dollar Invested Age (MDIA), CryptosNewss discovered that Cardano’s [ADA] long-term holders have chosen not to put their tokens back into circulation.
On April 15, Cardano’s 90-day MDAI increased to 269, according Santiment’s on-chain data. An increase in network activity is shown by a declining MDIA.
This has historically indicated that once investors transfer their assets into circulation, ADA will likely benefit.
Conversely, a rise in the statistic has the opposite effect since sluggish investments can impede an upswing. As of the time of publication, ADA’s price has recovered $0.49, joining the overall market recovery.
Obstacles to come
Nevertheless, a study of the price movement revealed that the token had difficulty passing the psychological threshold of $0.50.
The ADA may not escape $0.50 if the MDIA keeps rising, but it may fall below $0.49 in the near future.
But perhaps this conclusion is a bit too quick. Consequently, CryptosNewss proceeded to assess other metrics. We looked at a few metrics, including Mean Coin Age (MCA).
With a small exception, the MCA displays signals that are comparable to those of the MDIA. A low coin age in this case indicates that new coins have been added and released to a cold wallet.
However, an increase in the MCA indicates that a large number of coins have entered circulation. Most of the time, there has been a negative association between Cardano and growing coin ages.
Consequently, despite the short-term bullish trend, the cryptocurrency’s price ran the risk of seeing a significant collapse. In an extremely pessimistic scenario, ADA may fall to $0.46.
On the other hand, the value may improve if long-term holders behave differently.
Moreover, buying momentum was not strong, as the Relative Strength Index (RSI) showed.
The 4-hour chart’s RSI climbed, but its value of 50.58 indicated that the bulls were not fully in charge.
A climb to $0.53 could occur.
Should buying momentum pick up, ADA could be able to move above $0.50. However, ADA may fluctuate between $0.46 and $0.49 if the RSI remains near the middle.
The Exponential Moving Average (EMA) of the 4-hour ADA/USD chart showed that the bearish was remained present. The 20 EMA (blue) had been surpassed by the 50 EMA (yellow) at the time of publication.
This is known as a death cross, and it usually points to a downward trend.
But the fact that ADA had crossed above the 9 EMA indicated that bulls might be attempting to drive the price higher. As it stands, the token may try to reach $0.50. But resistance might be encountered nearby.
Should the closure go well, Cardano might approach $0.53. However, if this is rejected, there may be another correction that ends at the $0.45 support level.
The Elder Force Index (EFI) stagnated in the interim, indicating that the ADA should combine. A rise in the EFI could lead to a token explosion. On the other hand, a drop in the indicator can validate a declining price.
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Disclaimer: Please note that the viewpoints and perspectives expressed by the author, as well as any individuals referenced in this article, are intended solely for informational purposes. They should not be construed as financial or investment advice. It’s important to acknowledge that investing in or trading cryptoassets carries inherent financial risks.