Cardano's impressive rally has been making waves in the cryptocurrency market, defying the market-wide turbulence with a price hike. As of early Wednesday, ADA reached an 18-month high of $0.80, with its daily trading volume increasing by 24% to $2.27 billion. But what's behind this surge?
The answer lies in the impressive rise in Cardano's whale activity. Large transactions consisting of at least $100,000 worth of ADA reached 9,824 last week, marking a five-month high, according to data provided by Santiment. This significant increase in whale activity suggests that large holders are taking notice of Cardano's potential.
Furthermore, the Cardano total open interest also broke the $400 million barrier for the first time since early August, per Santiment data. This indicator shows increased interest from derivatives traders, which could be a sign of a larger trend.
However, it's essential to note that the increasing trading volume, whale transactions, and open interest could put Cardano in the highly volatile zone. The rise of the Ukraine-Russia conflict could also add to the market volatility.
Despite the price surge, long-term Cardano holders with positive returns have declined. Data from the market intelligence platform shows that the asset's one-year dormant circulation dropped from 69.3 million ADA on Nov. 16 to 30.5 million ADA on Tuesday. This shift in the investors' movements suggests that the profit-taking trend has cooled down at this point as ADA holders might be eying a further upside.
Predictions:
Based on the current trend, I predict that Cardano will continue to experience a rally in the short term. The increasing whale activity and open interest suggest that large holders are taking notice of Cardano's potential. However, it's essential to keep an eye on the market volatility, as it could impact the price of ADA.
In the long term, I predict that Cardano will become a significant player in the cryptocurrency market. The increasing adoption of Cardano-based projects and the growing interest from derivatives traders suggest that ADA has a bright future ahead.
As the market continues to evolve, it's crucial to stay informed and adapt to the changing trends. Keep an eye on Cardano's whale activity, open interest, and market volatility to make informed investment decisions.
