On a weekly chart, ADA is up 13.73%. Cardano's fundamentals indicate that a trend reversal is imminent.
As AMBCrypto previously reported, #Cardano [ADA] experienced a steady rise last week; #ADA benefited from the upswing in the #cryptocurrency market following last week's Fed rate cut.
- At the time of writing, ADA is trading at $0.4018. This is an 11.5% gain on the monthly chart and a continuation of the bullish trend of 13.73% over the past week.
Since hitting a low of $0.303 earlier this month, ADA has maintained its upward momentum. This situation in the market has caused in the Cardano community in equal measure both #optimism and skepticism.
For example, a popular crypto analyst Ari Martinez in his recent analysis expressed skepticism, suggesting a reversal of the trend.
In his analysis, Martinez noted that the indicator TD sequential just gave a sell signal on the daily chart of Cardano. According to the analyst, this indicates a future correction, albeit short-term.
When a sell signal appears on the daily chart, it means that prices have been rising for a significant period of time and the market may be overstretched. Therefore, investors usually interpret it as a signal to take profits or to prepare for a reversal or price drop.
In this case, the signal indicates a possible short-term correction. Therefore, Cardano is likely to experience a temporary pullback before resuming the uptrend.
While the indicators highlighted by Martinez point to a possible next ADA move, it is important to determine what other indicators are saying.
For starters, the DAA divergence in Cardano prices has remained negative for the past seven days. At the time of publication, the DAA divergence of the ADA price is -45.63. If an asset is in this position, it suggests that prices are rising but active addresses are not.
This therefore suggests that price increases are unsustainable as they are driven by a shrinking user base.
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