- The low NVT ratio suggested that the token had reached its medium-term bottom
- Technical analysis predicted a rise to $0.82 for ADA.
Cardano [ADA] could be about to hit bears, according to signals from the adjusted 90-day NVT ratio. For those unfamiliar, NVT stands for Network Value to Transaction.
A high NVT ratio means that a cryptocurrency has high network value, but not impressive network activity. In seasons like these, investor sentiment is bearish and prices may fall.
However, Cardano’s N/A, obtained from Messari, was -1.23. Such low values suggest that the project’s transaction volume is growing faster than its market capitalization.
Source: Messari
ADA prefers a cup with a handle
For ADA, the decline was a bullish signal that could predict a higher value for the token. But AMBCrypto found it unsurprising that the volume exceeded the market capitalization.
Recently we reported that ADA was on the verge of leaving the top 10 after other cryptocurrencies turned around. However, this may no longer be the situation.
ADA’s price at the time of writing was $0.48. This value was up 2.01% in the last 24 hours, thanks to the recovery that altcoins had after Bitcoin [BTC] halve.
When we checked the information on the technical side, we noticed that the NVT signal was valid. On the 4-hour ADA/USD chart, the token formed a cup-and-handle pattern between April 15 and April 20.
Here, the bulls held the support at $0.44 and were able to push the Cardano token past the $0.47 resistance. With the cup and handle formation, ADA could consolidate for a while.
This potential consolidation was validated by the Relative Strength Index (RSI). At the time of writing, the RSI had declined from its previous uptrend, indicating that the token was losing its bullish momentum.
However, the Fibonacci extension of 4.236 could rise to $0.82 in the medium term. First, the price could reach $0.76 (the 3.618 Fib level) before breaking out and surpassing the psychological resistance at $0.80.
Is $1 possible this time?
Over the past year, Cardano has not reached the predicted level. As such, hitting the mark could open the door to a higher value than last seen in the 2021 bull cycle.
Meanwhile, the total number of ADA holders Remained at 4.47 million at the time of writing. The last time there was a notable increase in the statistic was on April 8, when 100,000 new addresses purchased the token.
Read Cardanos [ADA] Price forecast 2024-2025
If the number of holders remains as it is in the coming days, ADA’s price could trade sideways. For the mentioned period, the value could be between $0.46 and $0.51.
Source: TradingView
However, ADA demand could increase in the coming months. If this were the case, an ADA equivalent of $1 to $1 would be possible. But for now, Cardano may remain on the sidelines.