Could Cardano (ADA) Break Out of Correction and Resume Bullish Trend?

Recent Price Movement and Market Sentiment

Currently trading at $0.3438, Cardano bears have recently overpowered the bulls, leading to a 4% price drop within the last 24 hours. According to data from InToTheBlock, the differentiation between ADA bulls and bears has remained relatively unchanged; however, bearish sentiment slightly outweighs bullish activity.

Notably, only 12% of the total ADA addresses are in profit, a concerning observation for investors watching for potential recovery.

Yet, signs of a turnaround are emerging. Recent analytics from World Of Charts revealed a tight consolidation range forming on Cardano’s price chart, suggesting that if a breakout occurs, prices could surge past $0.50, potentially leading to substantial gains for holders.

Potential for Bullish Momentum

Analysts are hopeful that Cardano’s price could experience a robust rally, with projections indicating that a sustained breakout could facilitate an overall 90% bull rally. This optimism is bolstered by a pattern ADA previously followed in 2020, which could hint at similar positive momentum coinciding with key events, notably mid-November and the U.S. elections.

Additionally, COINOTAG has highlighted on-chain data metrics that signal a potential trend reversal. A significant decline in trading volume and open interest suggests investors should remain vigilant for bullish signs in the near term.

Technical Indicators at a Glance

The technical analysis reveals that ADA is currently testing a crucial resistance level: the 20-day Simple Moving Average (SMA). Should the price break above this resistance, it might serve as a catalyst for additional upward movement in the near future.

As per the latest data pulled from TradingView, Cardano’s Bollinger Bands indicate that the price is entering a less volatile zone. This suggests the possibility of a sharp move either upward or downward depending on market movements.