- ADA may show signs of a local bottom after finding support near the key price level
- Assessing whaling, especially compared to 2021, could be crucial
Cardano’s ADA has been in a downtrend for months, losing almost 60% of its value from its YTD high. However, recent performance suggests that bearish momentum may be drying up. Will this pave the way for ADA’s market bulls?
At the time of writing, ADA was just one spot away from being in the top 10 cryptocurrencies by market capitalization. This means that it still has an impressive market cap, implying that many are still holding this coin with bullish hopes for the long term.
In fact, ADA may already be on the cusp of its next bullish wave, judging by the price action in recent weeks. Selling pressure is leveling off, with strong support building around the $0.31 price range. The altcoin recently retested the same range after sliding down the charts after August 25.
Source: TradingView
The crypto’s RSI also confirmed a potential pivot in the same price range over the past two days. Especially now that the selling pressure has decreased.
While there is a possibility of the price falling further, on-chain data seemed to indicate that whales have benefited from the altcoin’s reduced prices.
Assessing the accumulation level
Data from IntoTheBlock showed that ADA whales currently own more coins than at the peak of the 2021 bull run. For example, on September 6, the historical concentration suggested that whales held 3.2 billion ADA (9% of the circulating offer).
Source: IntoTheBlock
Zooming out revealed that whales held approximately 804 million ADA (2.51%) during the 2021 peak. However, they piled up significantly before the price went parabolic in 2021 and whale balances fell as the price rose.
In recent months we have seen whale stocks in the ADA grow, indicating more and more whales are on their way down. Investors owned 8.6 billion ADA at the last peak, while they currently own around 7.2 billion coins.
At the previous ATH, private assets stood at 23.16 billion, while they now own over 25.24 billion coins.
Is this the right time to buy? Well, according to the historical in/out of the money metric, ADA profitability is now at its lowest point in 2024. In other words, most ADA holders are at a loss at the altcoin’s current price level.
Source: IntoTheBlock
Simply put, approximately 3.73 million addresses are currently lost. At the beginning of 2024, this figure was 1.87 million addresses.
Additionally, at the time of writing, approximately 575,000 addresses were in the money, while 176,000 addresses were break-even.
Here it is also worth noting that the founder of Cardano is still actively involved in the project. In a recent one statementhe described Cardano as the biggest threat to Bitcoin’s dominance.
