TL;DR
- Large investors purchased almost 200 million ADA in the past 24 hours, reducing the circulating supply and potentially setting the stage for a price spike.
- Cardano’s social sentiment has been highly positive lately, suggesting a bullish momentum could be just around the corner.
Gearing up for a Surge?
Cardano’s ADA followed the overall revival of the cryptocurrency market in the past 24 hours, with its price rising to almost $0.75. In the following hours, though, it dropped to the current $0.72 (per CoinGecko’s data), which represents approximately the same level observed a week ago.
However, the increased whale activity signals that ADA might be on the verge of a renewed price rally. The popular X user Ali Martinez revealed that large investors have purchased 190 million tokens in the past 24 hours. The stash equals almost $140 million (calculated at current rates).
Such accumulation reduces the circulating supply of ADA available on the open market, potentially leading to a supply shock that could drive the valuation up (if demand doesn’t head south). Those actions could also encourage other industry participants to hop on the bandwagon, thus distributing fresh capital into the ecosystem.
Efforts of that type have indeed been followed by a period of resurgence in the past. Towards the end of November, whales bought millions of ADA tokens when the asset’s price stood at around $0.90. A few days later, though, the valuation briefly spiked above $1.30.
The High Positive Sentiment
Another essential element that could act as a price catalyst for ADA is Cardano’s crowd sentiment, which has recently been on the rise. The crypto analytics platform Santiment estimated that the altcoin’s community has “pushed up bullishness” to its highest mark in more than four months. Specifically, social media users have posted over 3.5 positive comments for every negative one.
A surge in positivity surrounding Cardano’s native token might motivate investors to jump on the bandwagon. The development could even lead to a FOMO (Fear of Missing Out) effect where people rush to purchase ADA in the hope that it will register more gains.
It is important to note that the phenomenon, which could cause a parabolic upward trajectory, is sometimes followed by a severe price correction. This means investors should tread carefully, do proper research before investing, and allocate only as much as they are ready to lose.
