Cardano (ADA) Holds Steady: Ready for a Short Squeeze?
The cryptocurrency market never ceases to surprise, and Cardano (ADA) is making waves even amidst recent price dips. As ADA avoids breaking critical support levels, traders and enthusiasts alike are speculating on a potential short-term bounce. If you’re following Cardano closely, several key signals point to a possible rally in the coming days.
Cardano’s Price Action: Why This Wedge Pattern Matters
Over the past seven days, Cardano’s price has decreased by around 10%, but it hasn’t strayed from its bullish falling wedge pattern. Falling wedges often serve as setups for upward price movements, and ADA is currently clinging to its lower boundary.
Buyers appear determined to defend this structure, as shown by a brief test of support on November 4, which held firm. This consistent defense could mark the beginning of a short-term rally.
Adding to this optimism, the Chaikin Money Flow (CMF) indicator—often used to measure capital inflows—has begun to rise again. This indicates that larger wallets might be adding more ADA after weeks of lethargy. Such inflows are frequently precursors to price rebounds.
Derivatives Market: The Case for a Short Squeeze
In the derivatives market, ADA’s short exposure significantly outweighs long exposure. On platforms like Gate.io, short positions exceed $93 million, while long positions hover near $24 million. With shorts holding nearly four times more leverage, any upward price action—such as a 2% rise—could trigger short liquidations.
If ADA breaks past $0.51, this could set off a chain reaction of short sellers closing positions, accelerating price momentum. Should this happen, the next resistance levels to watch are $0.64 for a breakout confirmation and $0.49 for invalidation.
How to Take Advantage of This Opportunity
For those looking to capitalize on ADA’s potential bounce, staying informed about market signals is essential. A useful tool for this is eToro, a trusted cryptocurrency trading platform. They offer real-time market updates and tools tailored for both beginners and experienced traders. Try eToro here.
Conclusion: A Moment of Potential for Cardano
Cardano’s resilience sparks possibilities for a short-term breakout amid market trends. Armed with tools like CMF and an understanding of derivative market dynamics, traders might find opportunities to turn this speculation into profit. Whether you’re a seasoned trader or a crypto newcomer, keep a close eye on ADA’s next moves.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Always do your own research and consult a professional before making investment decisions.
