Cardano Price Prediction: ADA looks to climb 16% after recent meltdown

  • Cardano price dropped 30% from June 20 to June 22 as the crypto market crashed.
  • After forming a bottom at $1.01, ADA appears primed to retest $1.451.
  • On-chain metrics point to an arduous climb.

Cardano price swept the swing low formed on May 19 during the recent sell-off, creating a bottom. Although ADA has risen considerably from this local low, more upside seems to be on the table.

However, on-chain metrics indicate that the upswing will not be easy.

Cardano price prepares for mean reversion

Cardano price slid 30% after the recent sell-off, setting up a local low at $1.01. Since hitting this level, ADA has risen nearly 24% to where it currently stands, $1.243. The so-called “Ethereum killer” is set to rise to $1.451, just below the 50% Fibonacci retracement level at $1.481.

However, this upswing will need to slice through the resistance level at $1.327 to hit $1.451. If ADA produces a decisive 4-hour close above $1.481, it will likely tag the supply zone, ranging from $1.525 to $1.624.

ADA/USDT 4-hour chart

ADA/USDT 4-hour chart

Adding credence to the bull rally is the uptick in new addresses joining the network from 786 to 968 between June 20 to 22. This 23% increase reveals that investors are interested in ADA at the current price.

ADA new addresses chart

ADA new addresses chart

While ADA price is likely to revert to the mean, IntoTheBlock’s Global In/Out of the Money (GIOM) model shows that the uptrend will be a tough journey.

Roughly 215,000 addresses that purchased 3.91 billion ADA at an average price of $1.33 are “Out of the Money.”

Similar clusters of underwater investors are present up to $1.88. Therefore, the bullish momentum needs to slice through these barriers to have any chance of hitting the intended target.

ADA GIOM chart

ADA GIOM chart

A sudden spike in selling pressure or rejection at $1.327 could hinder the upswing. Therefore, investors need to keep a close eye on the large transaction metric. This on-chain index tracks transfers worth $100,000 or more and has risen from 2,500 to 4,540 in the past four days.

Often an increase in large transactions coincides with local tops; therefore, the recent bump in this on-chain index indicates that a potential sell-off could be on its way.

ADA large transaction chart

ADA large transaction chart

If Cardano price slices through the recently set up swing low at $1.01, it will invalidate the bullish thesis. In such a case, ADA might retest the local bottom at $0.92 formed on April 23.

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