Cardano price analysis: Here’s why ADA has just gone parabolic
The Cardano price has been a major winner this week as the altcoin season continues. ADA, its native token, is trading at $1.07, which is the highest it has been since February 17th this year. It has jumped by over 43% from its lowest level this year.
Cardano DeFi ecosystem grows
The ADA price has been in a strong bullish trend in the past few months as investors cheer the ongoing growth of its ecosystem.
According to DeFi Llama, the platform’s total value locked (TVL) has jumped to an all-time high of over $321 million. This is a notable growth considering that the ecosystem was barely in existence a few months. The TVL was at about $1 million when the year started.
This growth has been mostly because of MinSwap, which has seen its TVL grow to more than $195 million. This price represents about 102% growth in the past seven days. SundaeSwap has also seen its TVL grow to over $124 million.
In a statement, Charles Hoskinson said that he remained optimistic that the ecosystem will keep growing in the near term. He said that there were thousands of developers currently building in the network. Still, only MinSwap and SundaeSwap have become runaway successes.
The Cardano price is also rising after an update by Input Output (IOHK) said that they were still working on the network in a bid to make it significantly faster and more stable.
Another reason why the ADA price is rising is that most altcoins have been rising as investors buy the dips. In the past few days, we have seen most altcoins like Ethereum Classic and Elrond rebound.
Cardano price prediction
The four-hour chart shows that the ADA price has been in a strong bullish trend in the past few days. Along the way, the coin managed to move above the descending trendline that is shown in black. It has also moved above the 25-day and 50-day moving averages, signaling that bulls are in control.
Therefore, while the overall trend is bullish, I suspect that we will see a small pullback as bears target the key support at about $1. This is known as a break and retest pattern and is usually a sign of a continuation.