Cardano (ADA) Is the Cryptocurrency of the Day, How Did It Happen?
- ADA’s price climbed to $0.29, as bulls drove an upward momentum with sellers unable to void the movement.
- ADA was overbought and a retracement to $0.26 could be on the cards.
- If the OBV continues to increase, ADA may recover to $0.30.
Cardano (ADA) has been named the cryptocurrency of the day for October 28, according to a post shared by X (formerly Twitter) CryptoDep. The token of the day is a list coined by the crypto social intelligence platform LunarCrush.
To be top of the list, a project needs to have a significant surge in terms of the altrank and the galaxy score. Using the galaxy score and altrank, LunarCrush gives an idea of the interactions within a project’s community.
So, for ADA, being the cryptocurrency of the day means that there was a notable increase with respect to market activity around the token. When it comes to the price action, ADA changed hands at $0.29. This value was a 0.82% decrease in the last 24 hours. But in the last seven days, ADA has had an impressive performance.
ADA Shows Potential for a Breakout
Another reason ADA could have hit the milestone could be linked to the series of events that occurred during the week. For instance, ADA was one of the tokens that previously had an abysmal performance out of the top 10.
However, the ADA/USD daily chart showed that support suddenly appeared at $0.24. This was because of the glaring seller exhaustion the token has had. Bulls took advantage of the support to increase buying pressure, as ADA flipped $0.27.
But at $0.281, the token faced rejection. However, sellers were not able to resist the bullish bias for long as ADA climbed to $0.29. As a result of the buying pressure, the Relative Strength Index (RSI) jumped to 75.86.
This RSI reading is considered overbought. Hence, it is likely for ADA to retrace, and the targets to watch are between $0.26 and $0.28. Meanwhile, the On Balance Volume (OBV) showed that the reversal may only last a little while. At the time of writing, the OBV was increasing.
The increase in the indicator, as shown above, is a sign of buyers’ presence in the market. Should the OBV maintain its position and the ADA price decrease, then a jump to $0.30 may be next for the cryptocurrency.
Another reason the Cardano network has been able to get the attention of the market is the increase in its Total Value Locked (TVL). At press time, Cardano’s TVL was $198.43 million. This value was a 22.30% hike in the last seven days.
The TVL is a measure of the total assets staked or locked in a protocol. When the TVL increases, it means there are more market players who trust the protocol. A decrease implies otherwise. Hence, for Cardano, the TVL means that there has been a surge in liquidity assigned to the toke protocol.
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