Cardano (ADA) has defied the overall market trend with an impressive 11% price increase in the last week. As prices rise, transactions involving the altcoin have turned profitable, leading some long-term holders to liquidate portions of their holdings.
Despite this profit-taking activity, the 11th largest altcoin by market cap is aiming to sustain its upward momentum.
Cardano Long Holders Secure Profits
Cardano transactions have yielded substantial profits over the week, spurred by a double-digit price rally despite a decline in the broader market.
On Thursday, the ratio of daily on-chain transactions in profit versus those in loss hit 1.53. This suggests that for each ADA transaction that resulted in a loss, there were 1.53 transactions that were profitable.
This trend has driven ADA’s long-term holders to divest some of their coins for profit, as reflected in the slight reductions in Cardano’s Mean Coin Age and Mean Dollar Invested Age.
According to Santiment, these metrics that monitor the activities of long-term holders observed a decline on September 11. A drop suggests that long-term holders, who generally accumulate at lower prices, are selling to lock in profits. This selling action reduces the overall age of the coins they hold.
ADA Price Prediction: Breaking Resistance Is Essential
While profit-taking is in progress, the price of Cardano is well-positioned to continue its upward trajectory. The coin is striving to break through the descending trend line that has constrained its trading since July 15.
This bearish line occurs when an asset confronts considerable selling pressure and struggles to surpass a particular price level, thereby creating robust resistance. Given the solid demand supporting its price increase, ADA’s efforts to rise above this resistance line could succeed.
If Cardano’s price successfully breaches the trend line, it could potentially climb by another 34%, reaching a two-month peak of $0.47.
Read more: How To Stake Cardano (ADA)
However, should profit-taking accelerate and buying pressure diminish, the effort to surpass the resistance level may falter. In this case, Cardano’s price could decline to $0.27, negating the bullish outlook.
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