Sharks and whales put Cardano on the map: Is a rally forthcoming?
- ADA’s on-chain transaction volume increased continually for six months.
- Traders were bullish on price action.
Oftentimes, cryptocurrencies are characterized by the influence of large holders, whose actions can sway market sentiment and dictate price movements. However, the impact of these actions may not be immediate at first glance, as with Cardano [ADA], which was ranked eighth on the market cap standings at press time.
Read Cardano’s [ADA] Price Prediction 2023-2024
Back to the crest
According to on-chain analytics platform Santiment, ADA sharks and whales, who hold between 100,000 – 10 million tokens, have been accumulating. As a result, total accumulation has reached the peak registered in September 2022.
This accumulation by the cohort, which represented 34.02% of the total ADA supply, also ensured that on-chain transaction volume has been rising since February.
?? As #Cardano sits just above $0.29, whales and sharks holding between 100K-10M $ADA have accumulated back to their highest level since September, 2022. Additionally, #onchain transaction volume has been rising nearly every week for the past 6 months. https://t.co/x9mUHDIhnx pic.twitter.com/X9WphDpPvy
— Santiment (@santimentfeed) August 8, 2023
On-chain volume refers to the total amount of assets via a blockchain network and is not necessarily traded. At press time, ADA’s on-chain transaction volume was 49.69 billion— an incredible rise from 16.18 billion on 3 February.
Whale accumulation alongside a spike in on-chain volume tends to suggest that an asset will recover sooner or later. But ADA had not succumbed to this notion. This was because its closing price when accumulation began was much higher than the press time value.
At the trench of whale accumulation, ADA’s value was $0.39. But at the time of writing, it was $0.29. Well, this drop could be linked to massive profit-taking. Needless to say, ADA had an extended uptick period from March to April and June to July.
ADA: Bullish bias appears
While ADA’s weighted sentiment was not as high as it was when the price was $0.39, on-chain data showed that it had improved in the last 30 days. Intuitively, the weighted sentiment spikes when the average social commentary is positive. The metric also falls when the acumen is gloomy.
Therefore, the hike in the metric means that the perception toward ADA has improved. But what expectations do traders have for the price?
Well, to address this, the funding rate comes into play because it can tell when the sentiment is bearish or otherwise. At the time of writing, ADA’s funding rate was 0.006%.
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Since the metric was in the positive region, it implies that long-positioned traders were willing to pay shorts to keep their contracts open. So, there were more open longs overriding shorts contracts, and the broader sentiment was bullish.
However, when ADA will begin its recovery back to $0.39 is widely unknown. But if this sort of accumulation continues, then it’s only a matter of time before the token rises above $0.3.