Thanks to multiple macro positives and a favorable technical outlook, ADA's price broke a months-long downtrend, pushing Cardano to a four-month high.
With Donald Trump winning the 2024 U.S. presidential election, market strength has increased, with prices rebounding strongly over the past four days, rising over 33.7% on November 8 to reach intraday $0.436.
ADA's price has increased by 17% in the past 24 hours, outperforming other markets, with a 28% rise over the past 7 days.
ADA/USD daily chart. Source: TradingView
Let's take a look at the factors driving ADA's price increase today.
ADA's price followed the rise of Bitcoin and Ethereum
This bullish sentiment is not limited to Cardano; driven by Donald Trump's victory in the U.S. presidential election, cryptocurrency prices surged across the board.
Bitcoin
Bitcoin, the largest cryptocurrency by market capitalization, led the charge, rising 9.6% over the past week and reaching a historic high of $76,943 on November 7, up 12.7% since November 5.
Ethereum has risen over 3% in the past 24 hours, with trading prices exceeding $2,900.
24-hour performance of top cryptocurrencies. Source: Coin360
Other top cryptocurrencies, including Binance Coin from the BNB Chain, Solana, Ripple, and Dogecoin, also saw significant increases in the past few days.
Similarly, the total market capitalization of cryptocurrencies increased by 2% in the past 24 hours, rising 14% over the past four days to reach $2.57 trillion at the time of this article's publication.
Trump's victory is viewed as favorable for the cryptocurrency market, as he promised to create a crypto-friendly business environment, boosting risk appetite.
In addition to political factors, the Federal Reserve's decision to lower interest rates by 0.25% on November 7 added tailwinds to the cryptocurrency market, as the Fed pointed out that the labor market conditions had eased and confidence in inflation steadily moving towards the 2% target had increased.
Source: Kobeissi Letter
Lower interest rates typically enhance market liquidity and support asset valuations, creating a risk environment where investors seek higher returns, including cryptocurrencies.
ADA funding rate surged
Before the bullish price movement of ADA on November 8, the open interest weighted funding rate jumped. The chart below shows that ADA's 8-hour OI weighted funding rate rose to 0.0159% on November 7, the highest level since June 2024.
This indicates a high demand for long positions, as ADA's price increased by about 17% in the past 24 hours.
ADA OI weighted funding rate. Source: CoinGlass
On November 8, ADA's rise was accompanied by short liquidations totaling $1.67 million, while long liquidations amounted to $247,484, and this figure continues to rise as of the publication of this article.
ADA liquidation. Source: CoinGlass
In other words, ADA's rise to $0.438 caught short sellers off guard.
Cardano's price is expected to rise further
Cardano's rise today is part of a technical rebound that began on November 5. Notably, the latest rebound has pushed the Layer 1 token above its months-long downtrend resistance line, as shown below.
ADA has made several attempts to break this resistance level but has failed each time, with the most recent attempt from September 6 to September 27, rising over 32%, but was capped by sellers at $0.42.
ADA/USD weekly price chart. Source: TradingView
According to this technical setup, the next reasonable target for ADA bulls will be the range high of $0.52 from April 22, a 19% increase from the current price.
