Cardano (ADA) is down around 37% this year. However, in the past seven days, the altcoin has surged by 13.40%, showing promising signs that this could be the start of a long-term uptrend.

While this prediction may depend on certain factors, key indicators suggest it could come true.

Cardano issues buy signal

According to the weekly chart, ADA saw a significant surge between December 2020 and May 2021, jumping from $0.15 to $1.77 – a gain of 1,041%. This rally was largely driven by a positive signal when the 50-day Exponential Moving Average (EMA) crossed above the 100-day EMA.

In February 2021, ADA’s 50-day EMA crossed above the 100-day EMA, signaling the start of its substantial rally. Interestingly, the current price of $0.39 and its EMA alignment appear to mirror the setup before its previous bull run, suggesting that a breakout from the bearish triangle may be on the horizon.

Cardano (ADA) Chart on TradingView

Therefore, if the price breaks out of the bearish pattern, it could repeat past performance, possibly rising 500% in the next six months. If this happens, ADA could reach $2.40.

Another indicator that supports this perspective is the 30-day Market Value to Realized Value (MVRV) ratio. The higher the ratio, the higher the profitability and willingness to sell. Conversely, when the MVRV ratio is low, most holders tend to hold on to their assets.

According to Santiment, Cardano’s MVRV ratio currently stands at 11.95%. This suggests that while there is some profitability, many investors may be reluctant to sell, potentially indicating a bullish sentiment that could support future price increases.

MVRV from Cardano (ADA). Source: Santiment

Coincidentally, this reading is the same as in December 2020, reinforcing the trend that a significant rally in ADA is underway.

Read more: How to Buy Cardano (ADA) and Everything You Need to Know

Price forecast

The 3-day chart appears to be in line with the bullish outlook outlined above. On this timeframe, the Relative Strength Index (RSI) has risen above the neutral midpoint. As a technical indicator, the RSI measures momentum using the magnitude of price changes.

When it rises, the momentum is bullish. A drop below 50, however, implies that the bears are in control. From the image below, Cardano appears to be following the path that took it from $0.47 to $0.75 earlier this year.

Cardano (ADA) Chart on TradingView

If momentum remains bullish, a repeat of this move could occur. In this case, the price could reach $0.70 before the end of 2024. However, if the token becomes overbought and buyers choose not to push the price, Cardano could drop to $0.27.

The post Is It Time to Buy Cardano (ADA)? Historical Analysis Says Yes appeared first on BeInCrypto.