Cardano (ADA) has seen a 4.6% increase in the last seven days as the asset’s Bollinger Bands setup moved progressively to extreme levels. However, current market dynamics suggest that ADA might suffer a retracement, per this technical indicator.
Cardano market sentiment shifts
Data shows that the price of Cardano is already touching the upper bands at the 20-day SMA level, which paints a reversal scenario for the coin. That is, the price of ADA, which many market participants anticipated could hit the psychological $1 mark, might not happen for now.
Notably, the Bollinger Bands hint at a short-term retracement for Cardano in the crypto market. Although the market is bullish, a shift might soon happen.
Cardano is ahead with a 1.8% gain, far above the general market figure of 0.45%, as ADA exchanges at $0.8173. However, investors are not actively transacting as trading volume has dropped by 13.86% to $1.11 billion.
The pullback by traders in the ecosystem could serve as a catalyst for ADA’s short-term reversal from its journey to $1.
As U.Today reported, ADA recorded an over 4% increase in price as buying pressure from market participants increased. Given the trajectory, traders were eyeing the $1 level as achievable. However, with volume dropping, the gains could reverse.
If nothing shifts, Cardano’s battle through several resistances to attain the current level could become undone as the price plunges to lower depths.
Cardano growth push anchored on volume
Interestingly, less than 48 hours ago, investors were bullish on ADA, hitting $1 as open interest surged by 27%. This led to traders committing 1.2 billion ADA, valued at around $958 million to ADA’s futures market in anticipation of more growth.
With the Bollinger Bands’ development, market observers remain keen on seeing how the price unfolds and the ecosystem’s reaction. If there is a spike in trading activity in the coming days, it might support ADA’s continued push for the $0.90 resistance level.
The correlation with the BTC price may also serve as a bullish trigger for the top altcoin on its rebound journey.
