Market cap

Cardano Supports Altcoins as Market Cap Rises CryptoBlog

In the last 24 hours, the total cryptocurrency market volume increased by 63.00%. Cardano was one of the top performers among cryptocurrencies as ADA holders wait for a recently announced new feature that could improve the smart contract capabilities of the network.

FOMO?

Major cryptocurrencies including Bitcoin and Ethereum are gaining momentum in Monday’s cryptocurrency market. Over the past day, the global crypto market cap increased by 2.54% to $1.27T.

The hard fork of ADA, Vasil, is expected to take place on June 29, 2022. Following the upgrade, many investors have started speculating on its upside potential. On June 6, the price of ADA rose over 14% to $0.64. In comparison, ETH has gained 6% over this period.

Trader behavior during the days leading up to a hard fork is similar to previous years. For example, in September 2021, the launch of the smart contract platform “Alonzo” caused the price of Cardano to soar by 200%. On the other hand, in March 2021, the “Mary” hard fork caused the price of Cardano to skyrocket by 1,600%.

An increase in interest in Cardano

Previous price increases were triggered by an expansionary macroeconomic environment, reflected in the Federal Reserve’s massive bond-buying program. At that time, interest rates were at zero and the Fed was buying about $120 billion in bonds a month.

The US central bank has started raising interest rates due to the country’s persistent inflation. This has reduced the liquidity of the dollar, which is also likely to affect the purchase of riskier assets such as stocks and cryptos.

The Fed’s decision to raise interest rates sent Cardano plummeting, with the stock trading around 80% below its September 2021 high. The broader decline also included significant rebounds.

Higher price in the coming days?

ADA is currently testing a resistance confluence consisting of a descending trendline and its 50-day moving average, a horizontal trendline, and a red wave labeled as a double bottom. If the pair can break through this resistance, it could trigger a significant move higher.

If the resistance confluence breaks above the resistance, it could trigger the formation of the double bottom. This is because the distance between the two lowest levels and the neckline of the descending channel adds to the target. For example, if the price of cryptocurrencies rises 40% from the June low, the target is around $0.87.

A follow-up rally could see ADA testing its 200-day moving average at around $1. However, a more likely scenario is a deeper correction, given the current macro risks.

Ethereum is gaining, but more slowly

After a relatively slow start to the week, Ethereum is back on track and trading near $1,900. The move is an important step for the cryptocurrency as it shows it can still rebound from its lows. However, the large number of short positions sold during the rally led to a new three-year high in market sell-offs.

The recovery trend for Ethereum has been strong as it managed to break above its 20-day moving average. This is an important point for the digital asset, as it struggled to break above the $1,700 mark. It is also the only green close in the last two weeks for ETH, far behind Bitcoin.

Although the liquidations of the past 24 hours have eased, they remain elevated. Due to the liquidations of the Bitfinex short selling scandal, the market has been relatively calm. Today, the total liquidations in the crypto market are around $130 million.

Source: https://crypto.news/cardano-takes-charge-among-altcoins-as-market-cap-increases/