Cardano (ADA) has been one of the crypto market’s top performers in November. In just one month, ADA has rallied by more than 120%. Altcoin’s market capitalization doubled from below $18B to $34B during this period.
In the last 24 hours, ADA has gained by around 22% to trade at $0.97 at press time, its highest price since May 2022.
The recent gains appear to have attracted the attention of Cardano whales. Data from IntoTheBlock shows that over the past month, Cardano addresses holding more than $10M worth of ADA have increased their positions by over 250%.
When large ADA addresses start accumulating, it suggests a bullish sentiment. If this cohort continues adding to the buying pressure around ADA, it could trigger a solid price recovery and potentially stir a rally toward $3.
However, retail traders hold a large amount of ADA, an indication that volumes from this group are also needed to support a price recovery.
Cardano Buying Activity Surges
Cardano’s one-day chart shows signs of retail euphoria amid rising buying activity. The Relative Strength Index (RSI) stood at 82 at press time, showing that ADA is overbought. Typically, whenever the RSI shows that a token is overbought, it leads to a near-term correction.
However, Cardano’s RSI has been in the overbought region for nearly two weeks, and buying activity shows no signs of easing. This is seen in the volume histogram bars, which have been green for the last three consecutive days.
The Average Directional Index (ADX), which measures the current trend’s strength, is also tipping north. This metric suggests that despite the overbought RSI, Cardano is still bullish, with the price set to push higher.
If this trend continues, ADA could aim for the next resistance at the 1.618 Fibonacci level ($1.12).
Cardano short liquidations surge
Traders taking short positions to bet against Cardano’s uptrend have also witnessed a significant liquidation surge.
Data from Coinglass shows that in just 24 hours, ADA short liquidations reached $8.27M. When short sellers are liquidated, they are forced to become buyers to close their positions. The forced liquidation adds more buying pressure on ADA.
Traders on the derivatives market also continue to open new positions to bet on ADA, as seen in the open interest, which has increased to $772M.
