“ADA Surges 10%: Key Bullish Signals Amid Volatility Concerns”

TL;DR

• ADA’s market value exceeded $0.35 for the first time this month, coinciding with improvements in key network indicators for Cardano.
• The RSI has recently crossed into overbought territory, indicating a possible price correction ahead.

ADA’s Impressive Performance

In recent days, the Cardano native token has shown strong performance, achieving a 10% price increase weekly and reclaiming $0.35.

This rebound could be attributed to the overall positive trend in the cryptocurrency market, with Bitcoin (BTC) reaching nearly $58,500 and Binance Coin (BNB) targeting $550. ADA’s upward movement aligns with the rise of significant metrics in its ecosystem.

According to IntoTheBlock, the “In the Money” indicator has risen by 8.3% daily, indicating bullish sentiment. This metric reflects the number of ADA holders currently enjoying paper gains. At present, 23% of investors are in profit, while 77% are facing losses.

Moreover, the total daily volume of ADA transactions (each exceeding $100,000) has climbed to $6.3 billion, marking a 5% increase over the past 24 hours.

Such activity suggests a surge in investor interest, potentially prompting further capital influx into the ecosystem.

On a different note, we will examine ADA’s open interest, which has risen in recent days and may indicate upcoming volatility. This metric represents the total number of outstanding derivative contracts—such as futures or options—that remain unliquidated and recently exceeded $145 million for the first time since August.

An increase in open interest typically suggests greater market involvement, indicating that more traders are entering the ecosystem. This is often a precursor to heightened volatility and significant price movements in either direction.

The Bearish Aspect

Despite the bullish signs, one indicator warns that ADA’s price may soon decline. This is indicated by the Relative Strength Index (RSI), which surpassed a reading of 70 today (September 12).

The RSI ranges from 0 to 100, with values above 70 indicating that the asset is in overbought conditions and suggesting that corrections may be on the way. Conversely, readings below 30 signify oversold conditions, hinting at potential price increases.

It is worth noting that ADA’s RSI fell to 14.9 in early July (its lowest point this year), followed by a 22% price surge just weeks later.