Can Cardano (ADA) Price Reach $0.47 Soon?

Cardano (ADA) holders have reason to be cautiously optimistic, as the price of the altcoin increased by 3% last week, reaching $0.34. However, overall sentiment around the coin remains mostly bearish.

On-chain data and price charts suggest that ADA could rise to $0.47 if the current upward momentum continues. The key question is whether there is enough interest to support this move.

Cardano price chart does not have the required support

While Cardano experienced a price rally last week, the rally seems unsustainable. This is seen in negative price daily active address (DAA) divergence, a measure that tracks the price movement of an asset with changes in its daily active addresses. Since September 3, this gauge has consistently returned negative values, indicating weak support for recent price gains.

When an asset's price rises despite a negative price gap, the price rally lacks strong support due to consumer activity, indicating weakness and unsustainability.

Cardano's declining whaling activity further reinforces this view. As of September 5th, data on the supply chain shows that large investors holding between 10,000,000 and 100,000,000 ADA are gradually reducing their holdings.

A decline in whale stocks is typically a hidden signal, which can prompt retailers to sell and take profits. If this trend continues, Cardano may lose its recent gains by selling pressure boosters.

Read more: How to buy Cardano (ADA) and everything you need to know

ADA Price Forecast: Bracket to decline to $0.27

Cardano's one-day chart shows that the altcoin is moving below its downtrend line since July. This losing trend line is formed when the asset faces strong selling pressure, which creates strong resistance as it struggles to break above certain price levels.

Although the recent rally has pushed ADA to this defensive line, the current buying pressure does not seem to be strong enough to break through. This is evident from the declining Chaikin Money Flow (CMF), which measures the flow of liquidity in the market. Cardano's CMF is currently negative at -0.01, indicating that it is out of market capitalization.

Read more: 6 Best Cardano (ADA) Wallets to Consider in September 2024

The combination of rising prices and falling CMF creates a divergence, indicating that the price rally lacks strong buying support and may face a correction soon.

The Fibonacci retracement indicator suggests that if buying pressure continues to weaken, the price of ADA may decline to the August 5 low of $0.27. However, if market sentiment turns to a bearish outlook, ADA's price may rise to $0.47.