Forex Analysis & Reviews: 20.08.2021 - The third force in the...

20.08.2021 04:03 PM

The third force in the market: ADA rose by 20% and set a new record

Five years ago, there was a certain division structure in the cryptocurrency market that looked like this. There is bitcoin - the main digital asset with the greatest opportunities and prospects, and there is the altcoin market - little-known coins that are of interest to the retail audience. Over the past few years, Ethereum has managed to break this division, and already in 2021, the main altcoin is on a par with Bitcoin. However, due to the difficulties that BTC and ETH are experiencing, a coin has emerged that can be considered a contender for a place in the top three.

We are talking about the altcoin Cardano, which has received a lot of updates over the past year and has improved the structure of the speed and processing of transactions. The last month was a breakthrough for the cryptocurrency. As of August 20, Cardano is among the top 3 crypto assets in terms of capitalization with a result of $80.5 billion. Over the past day, the coin has risen in price by 18% and is quoted at $2.5. Over the week, the cryptocurrency showed an increase of 38%, and, judging by the growing interest, this figure will increase significantly.

Over the past month, the altcoin has made a massive bullish breakout and hit a new all-time high. This achievement is usually compared with the upcoming 'Alonzo' upgrade, but the popularity of the asset is connected not only with this. Thanks to constant upgrades, the ADA developers manage to maintain user interest, which positively affects the on-chain activity of the coin. According to the analysis of the indicators Daily Active addresses and Active addresses 24 hour, Cardano significantly outperforms Ethereum. Thanks to this, many venture capital funds put altcoin on par with the market leaders, which allows the project to attract large investments. For example, Grayscale Investments and Wall Street funds began to actively invest in the development of the Cardano ecosystem. According to data from cryptocurrency exchanges, over the past week, altcoin managed to attract $1.3 million in investments, including institutional ones.

The powerful bullish breakout of ADA/USDT started on July 23rd thanks to the momentum that the BTC market gave. The coin managed to bounce off the local low of $1.13, after which the cryptocurrency slowly but surely approached the resistance zone around $1.5. The bullish breakout of this line has strengthened the interest in the asset, as a result of which the technical indicators of ADA acquired an upward direction. The next difficult line was the $1.8 mark, which later became a support zone. The breakout of this mark allowed Cardano to make a bullish spurt to a local high at $2.25, after which the coin began to correct to a local support level around $1.8. The bulls managed to regain this milestone, and the cryptocurrency continued its upward trend to $2.47. The asset's technical indicators indicate weakness, but this is a normal signal when the mid-May high is crossed. A local correction and the formation of a support zone around $2.2 are quite likely.

In the long-term plans, Cardano has all the chances to break the high of the price from May 16 and continue the upward movement to the next important line at $2.87. At this mark, the first level of external expansion starts, which the bulls will start to create after the breakdown of $2.47. Further movement of the coin will begin after the breakdown of the round $3 mark. In this area, a short-term correction is possible, as the asset will move in the range of corrective structures, where it will be necessary to form a buy shelf. In the range of $3- $4, the main resistance levels will be $3.30 and $3.9. The cryptocurrency has every chance to overcome all these milestones by the end of 2021 and bring the project to a completely new level. This is facilitated not only by on-chain activity and institutional interest, but also by the upcoming 'Alonzo' upgrade.

Thanks to the upgrade, smart contracts with support for the Plutus language will be implemented in the ADA network. In the long term, Alonzo should lead to the emergence of decentralized applications and services, including DeFi. Experts assure that ADA's activities will not affect the prospects of the ether in any way, but it is already clear that the Cardano project has made a significant step towards full-fledged competition with ETH.

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*El análisis de mercado publicado aquí tiene la finalidad de incrementar su conocimiento, más no darle instrucciones para realizar una operación.

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Crypto-currencies

Artem Petrenko,
Experto analítico de InstaForex
© 2007-2025

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