Historical data hints at further growth of Cardano (ADA)
The Cardano (ADA) rally may continue after an impressive 65% price increase over the past week. This forecast is based on historical data and expected investor behavior.
At the time of writing, ADA is trading at $0.72. An analysis of on-chain data shows that the recent rally may be just the beginning.
Cardano may continue to grow
One of the key indicators confirming this forecast is the ratio of market value to realized value (MVRV). This metric helps identify potential market peaks and bottoms and provides insight into investor behavior.
The higher the MVRV ratio, the higher the profitability of the holders and their willingness to sell. A decrease in MVRV, in turn, means a decrease in unrealized profit.
At the time of writing, the 30-day MVRV ADA ratio is -7.27%. Historically, when this value was reached, the altcoin price continued to rise. In addition, the recent addition of Cardano to the Robinhood listing may increase the demand of American investors.
The HIOM metric, which analyzes the difference between profitable and unprofitable addresses to assess market momentum, also confirms this forecast. The number of profitable Cardano addresses has started to increase, it is still far from the maximum values.
ADA Price Forecast: Is a 500% increase possible?
The weekly chart of Cardano resembles the dynamics of 2020-2021, when the price of ADA increased by 3,653% — from $0.061 to $2.29. This jump was supported by the intersection of the 20-week exponential moving average (EMA) over the 50-week EMA.
Although a repeat of this situation seems incredible, the price of ADA may still rise up to 500% in the coming months. If this happens, the altcoin will reach the $2.03 mark. The rise in the price of bitcoin (BTC) can also help, especially considering that Cardano is closely correlated with the main cryptocurrency. However, increased selling pressure will send Cardano in the direction of $0.33.