Cardano (ADA) investors have been closely watching the recent price surge of the crypto token, which has seen a gain of over 14% in the last seven days. However, on-chain data indicates that this price surge could lead to significant selling pressure from investors who recently entered the market.
Data from the on-chain analytics platform Santiment reveals that over an additional 12% of Cardano’s supply is now in profits. This could prompt holders of these tokens to secure their profits, especially given Cardano’s volatile price action throughout this market cycle. Despite the recent gains, Cardano has underperformed since the beginning of the year, with a year-to-date loss of over 35%, further incentivizing investors to take profits.
Loss of Confidence among Holders
Recent transaction patterns suggest that Cardano holders are losing confidence in the crypto token and are more inclined to secure their profits swiftly. The average holding time of coins transacted in the last thirty days has been 5 months, indicating that holders are quick to offload their tokens, a behavior known as “paper-handing.”
Data from the market intelligence platform IntoTheBlock shows that there are 481,370 ADA addresses that bought the token in the price range of $0.3 and $0.35. These investors could be among the first to secure profits, especially if they believe that the recent price surge is not sustainable. This potential selling pressure could lead to further downward price movements for Cardano.
Guidance for Holders
Crypto analyst Trend Rider has provided a guide for Cardano holders to navigate these uncertain times. According to the analyst, the range between $0.22 and $0.31 is a good buying area, while the zone between $0.42 and $0.55 is ideal for taking profits. He also suggests that a break above $0.75 could signal a bullish reversal and a potential rally for Cardano.
Current Price and Future Outlook
As of the time of writing, ADA is trading at around $0.379, up almost 4% in the last 24 hours. The future outlook for Cardano will largely depend on how investors react to the recent price surge, with profit-taking behavior potentially impacting the token’s price movements in the short term.
The recent price surge of Cardano has raised concerns among investors, with on-chain data pointing to potential profit-taking behavior. As holders navigate these uncertain times, guidance from analysts like Trend Rider can help them make informed investment decisions. The implications of investors’ behavior on Cardano’s price surge are significant, and careful monitoring of market trends will be crucial in determining the token’s future trajectory.
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