Can Cardano (ADA) surge 300% after this historic signal?

Green Light for a Cardano Rally

Currently trading around $0.27, with a slight increase of 2.7% over the last 24 hours, Cardano (ADA) finds itself in a turbulent zone. The daily trading volume hovers around $415 million, indicating moderate yet tense activity. According to recent data, two major contradictory indicators are simultaneously flashing green for the asset.

On one hand, the average ADA holders are significantly underwater, facing substantial unrealized losses. Indeed, when the MVRV is close to zero (as it is currently), it suggests that most investors have already panic-sold their tokens. In other words, this is a historical signal of a bottom and the end of capitulation.

On the other hand, in the derivatives market, traders are aggressively piling on short positions with unprecedented intensity in nearly three years. This asymmetry creates fertile ground for a massive short squeeze, a phenomenon where short sellers are forced to buy back their positions, thereby driving the price upwards.

A Technical Setup Tailored for a New Bull Run?

From a technical analysis perspective, this setup is reminiscent of previous cycles where extreme pessimism served as a springboard. When market sentiment reaches such a level of capitulation, the probabilities of a reversal (upward turn) increase dramatically. The last similar event actually preceded a staggering 300% rally for the scientific blockchain token.

For this bullish scenario to materialize, Cardano’s price must defend its immediate support around $0.24. A consolidation above this critical threshold would allow buyers to regain control and target the first major resistance at $0.28-$0.30. A decisive break above this level, accompanied by an increase in volume, would validate the breakout that the community has been eagerly anticipating. A positive close of the 2-week candle this week would be a good signal ahead of a potential rise towards $0.35.

Conversely, in a bearish scenario, if selling pressure intensifies and breaks the $0.24 support, ADA could face another correction towards the $0.20 zone. Momentum indicators, such as the RSI (Relative Strength Index), will need to be closely monitored to confirm whether the asset is genuinely in extreme oversold territory, ready to bounce back.

Can “Cardano” Break Through Its Resistances and Ignite an Upsurge?

The cryptocurrency market is notorious for punishing overly obvious consensus. With derivatives traders massively positioned to the downside, even the slightest positive catalyst could trigger a chain liquidation. If Cardano manages to capitalize on this extreme positioning, the dynamics could quickly reverse, transforming the current fear into a powerful upward momentum.

The coming weeks will be crucial for price evolution. Investors will need to scrutinize the changes in open interest and funding rates on exchange platforms. A sudden reversal of these metrics would confirm that whales and institutions are beginning to accumulate the asset at discounted prices, setting the stage for a new bullish cycle.

As the network’s fundamentals continue to develop behind the scenes, the question is no longer whether the token is undervalued, but when the pressure will ease. Given this historically explosive technical setup, how far can the price of Cardano (ADA) go during the next impulse?

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