Is Cardano awaiting a reversal?
- Despite development activity, Cardano’s network activity remained high.
- A few metrics and market indicators turned bullish.
Cardano [ADA] had a rough week as its price plummeted by double digits. While this price drop can be primarily attributed to the bearish market condition, a few other factors might also have played their parts.
Read Cardano’s [ADA] Price Prediction 2023-24
One such factor could be a drop in the blockchain’s development activity, which could have stirred negative sentiment.
Delving deep into Cardano’s weekly performance
Santiment’s chart revealed that the blockchain’s development activity sank over the last week. The reason behind this was revealed by ADA’s weekly development report. The report highlighted the work done by multiple Cardano teams.
However, last week, no major updates were pushed, which might have caused the drop in the metric.
Nonetheless, the report mentioned the blockchain’s updated network stats. For instance, Cardano’s total native tokens reached 8.7 million, and total transactions surpassed 73 million.
There have been a total of 137 projects launched on the blockchain, while more than 1270 are currently building on the network.
What’s going down on #Cardano? ?
Check out this week’s development update on #EssentialCardano and stay abreast of all the latest developments in core technology, wallets and services, smart contracts, scaling, governance, and more. ?https://t.co/GAzbEl2jkf
— Input Output (@InputOutputHK) August 18, 2023
Interestingly, though ADA’s development activity dropped, network activity remained high. This was evident from the stable number of daily active addresses.
ADA’s transaction volume also remained relatively high. However, its velocity declined, meaning that ADA was used in transactions more often within a set time frame.
ADA’s chart turns red
The recent market trend has restricted most cryptos’ prices from going up. Like others, ADA’s price also plummeted substantially. As per CoinMarketCap, ADA was down by more than 10% in the last seven days.
At press time, it was trading at $0.2639 with a market capitalization of $9.2 billion.
The price drop caused an increase in negative sentiment around the token in the market. Cardano’s popularity also fell as its social volume went down. However, the bearish price trend might end soon, as ADA’s Open Interest declined over the last few days.
Additionally, its Binance funding rate was also red, suggesting that the ongoing price trend might change.
Realistic or not, here’s ADA’s market cap in BTC’s terms
In fact, ADA’s daily chart had already turned green as the price moved up marginally. Cardano’s Money Flow Index (MFI) supported the possibility of a trend reversal as it registered an uptick. However, the rest of the indicators were still bearish.
ADA’s MACD displayed a bearish upper hand in the market. Additionally, its Chaikin Money Flow (CMF) went down from the neutral mark, which looked concerning.