Cardano (ADA) recently experienced a slight decline after reaching $0.70, losing the crucial support level at $0.6. However, despite this setback, the blockchain network is showing significant development activity, with an increase in contributors, indicating long-term potential.
Earlier this month, Cardano’s native cryptocurrency ADA rallied strongly to $0.70. However, it subsequently experienced a decline after reaching a peak of $0.69 on December 14. This decline resulted in ADA losing the critical support level at $0.6, despite the bullish market structure on higher timeframes.
Despite the retracement, the Cardano blockchain network has seen substantial development activity. The platform has witnessed a notable increase in the total number of contributors to development activity, which is a positive sign for long-term investors and suggests that ADA remains a promising asset.
In the past week, the price of Cardano (ADA) reversed after dropping to its crucial support zone at $0.55. Since then, ADA has recovered by nearly 10%. Currently, ADA is trading 2% higher at $0.6016, with a market cap of $21.2 billion.
Cardano is currently in a significant demand zone, ranging from $0.6016 to $0.8421. Within this range, 208,690 addresses have acquired 2.07 billion ADA tokens. If there is a dip in price, support for Cardano is expected between $0.5450 and $0.6016. On the other hand, if ADA maintains its positive momentum and continues its rally, it may surpass the resistance at $0.8421 and target the psychological barrier at $1.
The Network Realized Profit/Loss (NPL), which assesses the profitability or realized losses of Cardano transactions, indicates that ADA holders have been taking profits. During the period from December 4 to 19, significant addresses holding ADA tokens have realized gains, particularly in transactions involving whale wallets holding $100,000 or more.
Looking at Cardano’s price prediction and DeFi strength, ADA has been following an upward trend since October 19, marked by higher highs and higher lows. It reached a peak of $0.6802 on December 14. The ADA/USDT 1-day chart suggests a potential climb toward the Fair Value Gap, ranging between $0.7021 and $0.7258. To reach $0.70, Cardano needs to surpass the resistance at the 38.2% Fibonacci retracement level, positioned at $0.6214.
However, a daily candlestick close below the 10-day Exponential Moving Average (EMA) at $0.5854 could challenge the bullish outlook for Cardano. In case of a decline, potential support levels lie at $0.5854 and the 23.6% Fibonacci level at $0.4745.
The Total Value Locked (TVL) in Cardano serves as a significant indicator of the chain’s relevance and demand within the market. On Tuesday, Cardano’s TVL crossed the $425 million mark, reinforcing a bullish outlook for the asset’s significance in the ecosystem. The DeFiLlama chart shows that Cardano’s TVL reached its highest point at $444 million on December 14 before retracing to $425 million.
In conclusion, Cardano (ADA) is experiencing a partial retracement after reaching $0.70 and losing the critical support level at $0.6. However, the blockchain network is showing substantial development activity, with an increase in contributors, indicating long-term potential. Despite the retracement, ADA has recovered and is currently trading higher. The network’s Total Value Locked (TVL) has also crossed the $425 million mark, reinforcing the asset’s significance in the ecosystem.
