The price of Cardano (ADA) rose 1.34% on May 13 and is currently at $0.821, preparing for a major breakout move to $1.137.
Bullish expectations are rising as Charles Hoskinson boldly defends the redemption mechanism, pushing ADA open interest (OI) to $987 million. As Cardano stands on the brink of a bull run, should you consider buying the altcoin?
Cardano price analysis targets $1.17.
Cardano price is up nearly 2% this week at $0.821, maintaining an uptrend after last week's 19% gain. This blocks the inverted head and shoulders breakout rally seen on the 4-hour ADA chart.
With the neckline overlapping the $0.75 zone, Cardano price action formed a bullish inverted head and shoulders pattern as marked on the technical chart.
The 49.85% breakout target is calculated by adding the depth of the pattern to the $0.75 neckline that coincides with the previous peak at $1.137.
Therefore, a $0.837 breakout could trigger the next major move for the altcoin. Notably, a minor resistance is present at $0.983, reflecting volatility near the psychological $1 mark.
Supporting the $1.17 price target, the MACD and signal lines are poised for a positive crossover to resume an uptrend.
Additionally, the Relative Strength Index (RSI) momentarily dropped to the halfway line from the overbought zone, a bearish divergence that resulted in a consolidation phase.
However, the RSI takes a V-shaped reversal from the halfway point, suggesting renewed buying pressure.
As the consolidation prolongs, the
$ADA price momentum trapped could be released on either side. If the $0.75 zone breaks, the breakout thesis will be nullified, suggesting a potential 20% drop to $0.647, followed by the next support at $0.60.
Optimism Sparks as Open Interest Nears $1 Billion
With the overnight recovery in Cardano, optimism surged in
$ADA futures. The OI jumps by 6.61% to reach $987 million, nearing the $1 billion milestone. Additionally, the funding rate spike to 0.0141% reveals the increased bullish activity. Hence, the derivatives traders are likely anticipating an uptrend continuation in ADA prices.
Charles Doubles Down on Off-Chain Sweep Defence For Unredeemed Vouchers
Boosting the optimism, Charles Hoskinson slams the rumors of unclaimed vouchers again. Initially, Charles explained the sweep of unredeemed Genesis UTXOs (voucher holders) as a crucial security and compliance step.
As many original voucher buyers failed to redeem
$ADA , the process was moved from an “on-chain process” to an “off-chain sweep” to ensure reduced fraud risk.
Finally, Charles added that proper communication was maintained with the unredeemed voucher purchasers.
The wider community was kept out of the broadcast, as it would’ve increased the risk of scammers targeting the buyers. The bold and logical move was part of the Shelley upgrade.
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