Cardano’s (ADA) price action offered holders some respite as the price broke through the downtrend line.
Cardano’s price action has been rather lackluster lately, with ADA trading at $0.3186 at press time, up just 0.74% on the day. But the price has fallen 89.81% from its all-time high in September 2021.
From a technical standpoint, the price of Cardano had been moving in a downtrend line for more than two weeks. Although at press time the price action was beginning to break free.
While ADA’s price break at the downtrend line offered short-term respite for holders, it is crucial that price breaks above the $0.330 resistance level and then turns it into support. .
older ADA in motion
The recent short-term volatility in Cardano’s price has seemed to put some old coins back into circulation. The Age Consumed metric for ADA highlighted that after the price action turned bearish, a noticeable amount of older ADA moved.
On November 24, more than 38.58 billion ADAs were transferred on-chain. Spikes in the Age Consumed graph signal that a large number of tokens are moving after being idle for an extended period of time. It could either indicate a redistribution or some kind of sale.
That said, the net realized profit/loss (NRPL) for ADA largely predicted losses for holders for most of the past six months. The metric calculates the net profit or loss for all coins spent during the reporting period.
Low NRPL values indicated capital outflows. However, a considerable drop in the NRPL could lead to an upward reversal if the bulls can take the prices above the $0.330 level. That said, with the speed showing a steady increase, it means the coin was being used more often in transactions within the time frame.
Cardano NFT and DeFi Space still boring
Activity in the NFT space often contributes to positive price momentum for the native blockchain token. A report in late October suggested that Cardano was the third-largest non-fungible token (NFT) protocol by transaction volume.
Meanwhile, the ADA price was appreciating. However, as of this writing, the NFT landscape appears to have lost some of its luster.
Total NFT (USD) trade volume is much lower now than in June and July 2022. While NFT trade volumes have held above average, unique addresses that have bought over $100,000 NFTs have dropped.
Recent updates around the ecosystem, like Cardano launching its algorithmic stablecoin Djed in January 2023, keep investors hooked. However, the coin’s TVL continued to decline.
Data from DefiLlama suggested that ADA TVL was hovering around the $53.46 million mark. Its TVL was down 83% from all-time highs.
Nevertheless, the medium and short-term on-chain metrics for ADA show slow price growth. In case of a short-term bullish price action above $0.33, then $0.40 would be the key to the reversal. However, if the price of ADA falls further, Cardano might revisit the lower mark of $0.30.
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