As Bitcoin climbs back above $106,000, altcoins are back in action. Among the recovering tokens, Cardano is showing a promising rebound rally to provide a breakout opportunity. With intraday gains rising to 0.40%, reflecting dominance at a crucial level, is this the best time to buy ADA?
Key points
- Cardano Open Interest hit a 7-day high of $1.50 billion, reflecting increasing bullish speculation as the funding rate remained at 0.010%.
- Cardano price trend is taking support from the 50-day EMA line to reclaim the $1 mark.
- With a possible triangle breakout, Cardano hints at a rise to $1.32.
ADA Derivatives Reveal High Bullish Speculation
Amid a potential price recovery, Cardano’s open interest saw a significant spike of 3.01% over the past 24 hours. Currently, open interest stands at $1.31 billion. Over the past few weeks, speculation of a high momentum move in Cardano among cryptocurrency traders has increased significantly, as evidenced by open interest. Over the past two weeks, open interest has risen from $626.33 million to a peak of $1.5 billion. This reflects a potential rise in bullish sentiment among cryptocurrency traders.
However, the current buy-to-sell ratio is $0.9198, reflecting a larger number of bearish positions underway. However, the financing ratio remains positive at 0.010%. This highlights the fundamental fact that Cardano traders are willing to pay the extra premium to hold their long positions. Therefore, analysis of derivatives data reflects Cardano traders’ expectations of a bullish recovery in the coming days.
The triangle pattern indicates Cardano price rising to $1.32
Cardano’s current price trend reveals two converging trend lines that encapsulate the short-term trend. As Cardano consolidates between the newly formed triangle pattern, a short-term reversal from the 50-day EMA line shows a bullish opportunity. Currently, Cardano is trading at $1.0134, reflecting dominance at the psychological level of $1.
As Cardano prepares to take a positive turn within the triangle pattern, buyers are anticipating a surprise rally as the broader market recovers.
Along with the 50-day moving average line, Cardano price action reveals strong bullish dominance at the 38.20% Fibonacci level at $0.9369. This increases the probability of a bullish return to complete the morning starting pattern.
In the event of a breakout above the 23.60% Fibonacci level at $1.08, the chances of the triangle rising will increase significantly. An upside breakout would challenge the immediate price target at $1.3219.
Hence, the current Cardano price trend reflects an upside potential of around 30%. On the downside, a break below the 38.20% Fibonacci level would test the $0.8180 level near the 100 EMA line.
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