Investors appear to be accumulating ADA at low prices. On-chain data shows buying pressure at an all-time high, while price build-up solid support could ward off further losses.

4-hour ADA price chart | Source: Trade View

ADA looks bullish above $1

ADA appears to be gathering bullish pressure for a breakout.

Cardano’s token has seen a sharp decline since hitting an all-time high of $3.16 on September 2, 2021. The market value of the smart contract blockchain fell nearly 71% on an increase in profit-taking.

However, investors on the sidelines now seem to be using the price drop to accumulate tokens.

On-chain data from Santiment shows that the number of addresses with between 10,000 and 1 million ADA has increased by 15,000% since December 15, 2021. Since then, around 3,900 large wallets have been created, indicating an increase in interest from retail investors.

Source: Santiment

A significant increase in the number of buy orders helped the price create a stable retaining wall. IntoTheBlock’s In/Out of the Money Around Price (IOMAP) model shows that more than 340,000 addresses previously purchased 7.65 billion ADA for around $1.

The demand zone could provide enough strength to absorb any increase in selling pressure and allow the price to recover towards $1.2 or even $1.6.

In/Out of the money at the price | Source: IntoTheBlock

While the odds are in the bulls’ favor, any major move hinges on the $1 support. A crucial daily close below this level will cause panic in the market and prompt investors to reduce the size of their positions. In such cases, ADA could capitulate at $0.66 and mark the end of the downtrend.

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Minh Anh

According to Crypto Briefing