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, PrimeXBT Analyst: The Perfect Combination Of Positive News Could Drive ADA Price Further, Forex-News, Forex-News
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PrimeXBT Analyst: The Perfect Combination Of Positive News Could Drive ADA Price Further

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, PrimeXBT Analyst: The Perfect Combination Of Positive News Could Drive ADA Price Further, Forex-News, Forex-News

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, PrimeXBT Analyst: The Perfect Combination Of Positive News Could Drive ADA Price Further, Forex-News, Forex-News

Amid much excitement, the Cardano team delivered on their promise and finally announced on Friday night the launch of the highly anticipated smart contract feature. This major update is scheduled for or around September 12.

The Cardano team has been busy recently releasing updates, which shows that a lot of work is being done to ensure a smooth transition. This has greatly excited the Cardano community, as well as cryptocurrency traders, who have been tirelessly buying the ADA token since the team announced on August 6 that the Alonzo Purple, the final stage of testing, was ready to go. jump.

Following the August 6 announcement, Cardano has started onboarding users and has launched the third and final stage of its Alonzo updates, which will enable the establishment of smart contracts on the Cardano network. This caused the price of the ADA token to skyrocket from $ 1.40 to more than $ 2.25, an increase of more than 50% in a week.

So the question arises: is this rally sustainable?

There could be more good news for the ADA token as, in fact, such an important milestone that it finally materializes, it is news to be optimistic about and it is not the only one.

Strong growth in developer activity

Many projects are already being built on the smart contract function in the testnet. Developer activity has increased significantly since the Alonzo testnet started, with the number of commits on Cardano reaching # 1 on Github for several days since August 6 when Alonzo Purple started onboarding projects. The noteworthy issue here is that the number of confirmations has been steadily increasing, and on August 11 it registered close to 600 confirmations, up from 545 just two days earlier. This shows that more and more developers are working or trying to build something on Alonzo, which is a very encouraging start.

The ADA price increase has been supported by strong fundamentals with increasing developer activity showing adoption.

Clear bullish signals on technical charts

The price increase has also been accompanied by a healthy increase in trading volume on exchanges, a sign of a sustainable rebound. While a sudden and abrupt explosion in volume is not a good thing, the steady rise in ADA volume is a good sign that more investors are piling up with each higher move in price.

With the ADA approval to list on Japanese exchanges recently, this opens the token to a new market of over 100 million people who were previously unable to buy. Japan is the third largest economy in the world and its population has one of the highest acceptance rates for crypto assets in the world.

Furthermore, ADA’s small circulating supply is also one of the reasons why the price could continue to skyrocket. Currently, a whopping 71% of ADA’s total supply is being staked to secure the network. This is by far the highest percentage of tokens staked in any crypto project.

This amount of staking has increased by 11% since the beginning of June, when the Cardano network first passed the 600,000 address milestone. In the run-up to Alonzo’s launch, the network has now grown to 749,400 unique addresses at the time of this writing and continues to grow.

An important conclusion that we can draw from looking at staking metrics is that no one is selling their ADA token even after such a large increase in price over the past week. Cardano’s stakeout program has a no-lock period; a delegate is free to stop staking at any time to sell their tokens. The fact that the group continues to grow despite ADA’s phenomenal price increase speaks volumes about the long-term commitment of the Cardano community.

This also means that there are not many ADA tokens circulating in the market to buy and sell, compounding the effects of an upward contraction in price.

All of the above factors point to explosive times ahead for the ADA token, and only the Relative Strength Index (RSI) is in an extreme overbought zone at present, as the only hurdle that could slow down this train. The price could find some resistance and consolidate as it approaches its all-time high of $ 2.47 made in mid-May, which will be a good chance for its RSI to cool down a bit before the eventual break of the all-time high. .

However, as we approach the smart contract rollout date on the main grid, a couple of issues could still affect ADA’s ability to keep growing. In the unlikely event of complications related to the hard fork on September 12, the price could be affected.

Furthermore, the way the ADA token will be used in smart contract applications could be a hindrance to the continued ADA rally, as it is not yet widely known whether the ADA token will be used to run applications on top of the Cardano network.

In the meantime, however, until user reports start pouring in after Cardano’s smart contracts go live, the hype could continue to spike the ADA after its RSI, which is at a ridiculous 97, goes down. cool down a bit.

Even though the Hard Fork is still almost a month away, traders need not worry that this fuss will pass, as the Cardano Foundation has many activities lined up to keep the excitement going.

Cardano brings a lot of marketing for greater adoption

To commemorate the passage to the era of smart contracts, Cardano has a summit prepared. Called Cardano Summit 2021, it will take place online from September 25 to 26, approximately two weeks after the hard fork. The event boasts of being worldwide, as it will take place on 7 continents, with a Cardano Hub on each, it has 20 community-led events and is expected to have a participation of at least 50,000 people.

The team’s marketing efforts to host the event are intense, with many Twitter updates promoting the event, including opening invitations for community members to host local gatherings in their respective home countries to be part of the summit. . It looks like a carnival is coming, which could raise awareness for people who are not yet aware of the token or its update. This could potentially bring in another group of new buyers.

In a bull market, with a major update, a good adoption history, a severe supply-demand imbalance, and a series of marketing events, it seems the time is ripe for ADA to finally take off.

About Kim chua, PrimeXBT Principal Market Analyst:

, PrimeXBT Analyst: The Perfect Combination Of Positive News Could Drive ADA Price Further, Forex-News, Forex-News

Kim Chua is an institutional trade specialist with a track record of success that extends to major banks including Deutsche Bank, China Merchants Bank, and more. Later, Chua launched a hedge fund that consistently achieved triple-digit returns for seven years.

Chua is also an educator at heart who developed her own proprietary trading curriculum to pass her knowledge on to a new generation of analysts. Kim Chua actively follows crypto and traditional markets and is eager to find future trading and investment opportunities as the two very different asset classes begin to converge.

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, PrimeXBT Analyst: The Perfect Combination Of Positive News Could Drive ADA Price Further, Forex-News, Forex-News

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