Cardano (ADA) is struggling to gain momentum despite market activity. According to an analysis by Crypto Zx, ADA’s lack of retail interest and competition from projects like Tron are key factors behind its stagnant performance.
Although the market has shown some signs of recovery, ADA’s future remains uncertain as it lingers below key resistance levels.
What you'll learn 👉
ADA’s Market Performance and Sentiment
As at the time of Crypto Zx analysis, ADA traded at around $0.35, reflecting a 3.5% increase over the past day. Despite this gain, the expert noted that the market perception toward ADA remains cautious.
With a market cap of $12.2B, ADA’s had a daily trading volume of $233.6M. This low volume strongly indicates a lack of buying pressure. Besides, this raises concerns about ADA’s ability to break out of this stagnation phase.
Crypto Zx highlights that Bitcoin’s dominance at 57.18% is a factor impacting ADA’s performance. As most market liquidity remains tied up in Bitcoin, altcoins like ADA struggle to attract the attention needed to drive price movement.
Additionally, Bitcoin’s resistance around $60.9K adds to the uncertainty. A clear bullish trend for Bitcoin is necessary for the broader market to thrive, including ADA.
Stagnation Amidst Rising Competition
Cardano’s price action has been relatively stagnant, with the next key resistance level identified at $0.40. The lack of retail interest and the market’s focus on newer, more hyped projects like Tron has contributed to this stagnation.
Crypto Zx points out that ADA has fallen out of the top 10 cryptocurrencies on CoinMarketCap, with Tron taking its place. This shift in market focus is a reason behind ADA’s flat performance, despite its strong fundamentals.
The analysis also emphasizes that a portion of ADA’s supply is staked, reducing the available circulating supply. While staking provides stability, it also contributes to lower trading volumes and reduced price volatility.
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Future Outlook and Potential for Recovery
Crypto Zx remains cautiously optimistic about ADA’s potential during the next altcoin season. The analysis suggests that ADA could recover to its yearly highs or even surpass them if market conditions improve.
A move to the yearly high would represent a gain of approximately 145% from current levels. Historical performance during the previous bull cycle supports this outlook, with ADA having been one of the top gainers in the last cycle.
However, the analysis also acknowledges the saturated market and the rise of competitors. The expert advices long-term ADA holders to remain patient and consider portfolio diversification to capitalize on profits from other coins.
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