Looking back on July 22nd, ADA was trading at $ 1.1 at that time. However, on August 22nd, Cardano registered a new ATH of $ 2.65. With ADA hovering around $ 2.5 at press time, the third-placed altcoin was bullish on the one-day, one-hour, and one-week charts.
Indeed, it can be argued that ADA is one of the few cryptocurrencies to experience the effects of the crash of the 19th century. All 100% holders were making money at the time of going to press, which is a rare phenomenon. So are these signs of the times that ADA is an unmatched investment? And is that move near $ 3 a sign that ADA could soon land near $ 5?
High development and higher euphoria
The upcoming Alonzo update has fueled the social sentiment as well as the price development of the crypto. The actively developing Cardano ecosystem and its contributors to development play a leading role in the asset’s rally.
Cardano’s development activities and the contributors to the development activities have kept a decent level regardless of price drops or pumps. This acts as the backbone of its ecosystem. It’s also one thing that many alts miss out on and end up weakening their credibility on the development front. This usually has a corresponding effect on the price.
That being said, another thing that Cardano rallies endorsed is the hyped social vibe. In particular, the social mentions of Cardano and ADA hashtags have absolutely exploded with the Alt’s new all-time high of $ 2.65. According to a tweet from Santiment,
“The crowd and their euphoric behavior at this level will have a big impact on whether prices stay near $ 3.00 and beyond.”
It will also have a huge impact on whether the price moves towards $ 5.00 as well.
Why it’s worth it, Hodling Cardano
When comparing the ROIs of the top alts vs. Bitcoin, it is noticeable that Cardano was consistently either the top performer or one of the top performers. At this point, Cardano appears to be seeing modest returns of over 100x from its recent low. Additionally, as analyst Benjamin Cowen pointed out, ADA will continue to do well in the coming days if Bitcoin stays above the 20-week SMA (which was well above at press time).
With cruise lines (mid-term owners) making up the majority of ADA owners, this investor segment has played a huge role in Cardano’s price growth. 72.85% of the ADA Hodlers were cruisers at the time of writing, ie they have a holding period of 1 to 12 months.
In addition, both stock market and derivatives signals showed bullish signs as the bid / ask volume imbalance was 2.88%. The momentum in the futures markets also turned bullish.
Do not miss this limitation
Leaving everything aside, one cannot ignore the fact that ADA has also bled quite badly in the past. If we compare it to the 2017-2018 peak, Bitcoin did even better at press time, as Bitcoin has more than doubled since its 2017 peak. In addition, ADA has shown a tendency to devalue when the king coin has done so. Major corrections could therefore prove costly.
So while the question of whether ADA hits $ 5 is believable, it is imperative to prepare well for minor slumps along the way.