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Can Cardano’s ADA Break Out of Its Slump in August?

Cardano’s (ADA) price has plummeted to alarming lows, leaving investors wondering if it’s possible for ADA to break out of its slump in August. The cryptocurrency is currently in a bearish trend with technical indicators showing resistance at $0.355. Its On Balance Volume (OBV) has flattened, and investors are still struggling to gain value.

The relative strength index (RSI) is currently at about 40, a bearish level, and these technical indicators collectively indicate that the selling pressure is far from over. However, closer inspection of on-chain metrics shows something else:

On-Chain Metrics: A Glimmer of Hope

The Mean Coin Age (MCA), which measures the average age of all coins in circulation, has been trending higher than ever before. This is often regarded as a buy signal, as it suggests that coins are being held for longer periods, which reduces selling pressure. Additionally, the daily active addresses metric has increased significantly since then, with significant spikes on August 5 and 8. This increase in network activity could be indicative of growing interest in ADA, potentially eventually leading to price increases.

Following a major drop below the psychological barrier of $0.3 in the first week of August, the cryptocurrency has made sluggish progress and is now at its lowest point of $429. Although this lower high may appear bearish on paper today, it’s important to note that ADA is still trading just below their crucial resistance level of $35.

A Glimmer of Hope Amidst the Gloom

While there have been some negative reports, there are some indications that an improvement could be expected for ADA. The cryptocurrency’s undervalued MVRV is currently down (negative) in the 30-day period, which could attract value investors looking to buy the dip. Additionally, the growing Mean Coin Age and increased network activity suggest that investors are accumulating ADA and waiting for the right time to strike. The continuation of this accumulation could provide the catalyst for a price breakout in the next few weeks.

Conclusion

Cardano’s technical indicators are still bearish, but on-chain metrics suggest softer growth. Given that ADA is trading below key resistance levels, investors should be watching closely for further developments regarding its price action. If the on-chain metrics keep improving and the technical indicators become more positive, then ADA could potentially experience a significant surge in August. However, it’s important to note that the cryptocurrency market is not always predictable, and investors should exercise their best judgment when investing wisely.

For more insights and information on Cardano and the cryptocurrency market, check out this article on CoinSeeks.com: Cardano Price Prediction 2023: Will ADA Reach $1.50?