Cardano (ADA) price bulls are navigating a challenging market environment as Bitcoin’s price crash has heightened volatility across the crypto space. Investors are keenly focused on securing support levels and timing their entry before ADA potentially embarks on a journey toward the $1 mark.
Cardano’s Path to $1 in September
Currently, Cardano’s price is holding above the critical support level at $0.35. Despite the broader market downturn, the fundamentals of the Cardano blockchain remain strong. Data from Santiment highlights a significant increase in active users on the network, surging from around 20,000 on August 22 to approximately 35,000 by August 27. This rapid growth in user activity underscores Cardano’s competitiveness and suggests that a price breakout toward $1 could be on the horizon before the end of September.
The Market Value to Realized Value (MVRV) ratio, which compares Cardano’s current price to the average acquisition price of existing coins, indicates that many holders are experiencing unrealized losses. This suggests that investors are unlikely to sell ADA at current levels, preferring to hold or even accumulate more in anticipation of a future price increase. The MVRV ratio dropping below 1 typically signals a buying opportunity, as investors look to capitalize on potential price gains.
Moreover, large investors, or “whales,” appear unfazed by the recent downtrend. Data shows that addresses holding between 100 million and 1 billion ADA have added 130.5 million coins since August 22, now holding 7.23% of the total supply. This increase in holdings amid falling prices points to a bullish outlook among major stakeholders.
ADA Price Technical Analysis
The short-term price outlook for Cardano hinges on the strength of the $0.35 support level, which aligns with the lower boundary of an ascending channel. This support area is crucial for maintaining the bullish momentum, and a rebound from this level could trigger a rally toward $0.42.
The Relative Strength Index (RSI), currently nearing oversold territory, signals that a potential buying opportunity may be approaching. Traders should watch for a bounce off the $0.35 support, especially if the RSI starts to reverse from its oversold position. A break above the channel’s resistance would invalidate the bearish pattern and could propel ADA toward the $1 target.
However, traders must also prepare for potential downside risks. If ADA fails to hold the $0.35 support, it could lead to further declines, with possible support levels at $0.32 or $0.30. In this scenario, some traders might consider shorting ADA, while others might wait for these lower levels to buy in anticipation of the next recovery.
Conclusion
Cardano is navigating a volatile market, but its strong fundamentals and increased network activity suggest that a breakout toward $1 is possible by the end of September. Investors should closely monitor key support levels and technical indicators to time their entries and exits effectively.
