- ADA price has moved above $0.93 and future volume jumped by 77% indicating more people are becoming active in trading.
- The open interest increased by 17% which indicates the inflow of new capital into the breakout rally of ADA.
- The Long/ short Ratio on Binance is more than 2.8 which indicates that top traders have strong bias towards long positions.
Cardano (ADA) price is on an upswing trying to breach the $1.00 price mark, after a resounding breakout of resistance levels. The fact that the market is strong in terms of participation and futures volume and open interest indicates the presence of strength, but traders are keeping an eye on possible trend continuation or temporary pullback.
ADA Price Breakout Rally Backed by Volume, Open Interest, and Buying Pressure
ADA broke out of a tight consolidation range between $0.85 and $0.87, surging past the $0.90–$0.93 resistance. The coin is trading at $0.9387 at the session with a small increase of 0.22%. The bullish nature of the candle supported by a strong bullish candle are indications that there is active buying. This is considered a shift in the momentum following a period of flat trading.
Futures trading volume rose by 77.14% to 6.49 billion. Open interest at the same time increased by 17.05% to 1.81 billion. This indicates new money in the market and not traders turning inventory. A steep rise in trading activity in breakouts can indicate additional price growth in the event of the ongoing unchanged demand.
The Cumulative Volume Delta (CVD) printed a positive 8.35 million, proving bullish demand. The uptick in CVD and corresponding movement on prices indicates that purchasers are taking their stands, as opposed to activity being based on thin markets or short term noise.
Source: TradingView
The technical indicators also support the upward momentum In the case of MACD, a bullish cross-over along with an expanding histogram are witnessed. RSI is at 75.31, therefore it is overbought, but especially in strong trends readings like these will be maintained. At 38, the ADX is high and indicates that a strong trend is being developed, which possibly may persist in the nearest future.
The futures market also indicates a high degree of long bias. Long/short ratios are above 2.4 in all the trader groups in Binance and OKX. Top accounts are more skewed in favor of long positions with ratios as high as 3:1. Although that demonstrates confidence in the upside potential of ADA, the skewed positioning can also increase the risk of a turnaround in case of changing sentiment.
Source: CoinGlass
Liquidation data over the last four hours indicates the shorts being squeezed. Approximately, almost $436K of short positions were liquidated, and this pushed the price further as well. But in the last 24 hours, long liquidations were slightly above, indicating possible over-leverage among bulls.
Futures are the leading activity in the market even though there is a high reduction in the turnover on options. The options interest decreased by almost 93%, indicating that traders want direct exposure to ADA through futures. Should the system maintain a higher price above $0.92 to $0.93, the next technical range will be a price of between $0.96 and $1.00.
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