Whale activity signals potential upswing

Cardano (ADA) price is currently struggling to find a clear direction. The ADX indicator is showing a weakening trend, indicating reduced momentum. This suggests that ADA is in a phase of consolidation, without strong bullish or bearish forces.

Whales have accumulated ADA, indicating potential upward movement. However, whether the price will break upwards or downwards remains uncertain as support and resistance levels come into play.

ADA ADX shows a weak trend

Cardano (ADA) currently has an Average Directional Index (ADX) of 15.51, down sharply from 41 just four days ago. This decline indicates a significant weakening in ADA’s trend strength.

The ADX is a widely used technical indicator that measures the strength of a trend without indicating its direction. ADX values ​​range from 0 to 100, with readings above 25 typically indicating a strong trend, and values ​​below 20 suggesting a weak or nonexistent trend.

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An ADX value of 41 previously suggested strong momentum, either up or down, indicating a decisive price move. However, the current value of 15.51 suggests that this momentum has waned, indicating a lack of clear directional strength, with ADA now in a phase of low volatility and reduced conviction among market participants.

Cardano whales are making moves again

In recent weeks, the number of ADA addresses holding between 1 million and 10 million ADA remained relatively stable throughout mid-September through October 7. Likewise, addresses with between 10 million and 100 million ADA have also shown a steady trend since the end of September, after a sharp drop between September 18 and 19.

However, from October 12 to October 15, the number of addresses with between 1 million and 10 million ADA grew from 2,450 to 2,462, indicating renewed interest from smaller whales while the larger whale cohort remains steady. These subtle shifts in ownership can provide valuable insights into potential market trends.

Tracking the behavior of these whales – specifically those who own millions of ADA – is crucial as they exert significant influence on the market. When whales accumulate or sell their holdings, they often correlate with upcoming price movements due to their potential to affect liquidity and market sentiment.

Although the current trend is not particularly strong, and the direction of ADA’s price remains uncertain, the recent accumulation by addresses holding between 1 million and 10 million ADA can be seen as a potential bullish signal.

Such accumulation during a period of low trend strength may indicate that larger players are positioning themselves for a future upward movement in ADA’s price, indicating optimism for positive momentum in the coming days.

ADA Price Forecast: Could it rise 17% in the next few days?

ADA EMA (Exponential Moving Average) lines are currently very close to each other, indicating that there is no clear trend direction at the moment. This often indicates that ADA’s price is in a consolidation phase, where the market does not have strong bullish or bearish momentum.

EMA lines are moving averages that place greater weight on more recent price data, making them more responsive to short-term price movements compared to a simple moving average.

When EMA lines converge and become tightly synchronized, this typically implies that neither buyers nor sellers dominate, leading to a period of sideways movement, where the price fluctuates within a narrow range without breaking out in either direction.

Read more: How to buy Cardano (ADA) and everything you need to know

Despite this consolidation phase, the recent increase in whale accumulation, as observed in the number of large ADA addresses, suggests that a potential upward trend may be on the horizon. If an upward move emerges, ADA could test resistance levels at $0.40 and $0.416, providing an opportunity for around 17% growth from its current levels.

However, if a downtrend takes hold instead, ADA’s price could drop to support levels around $0.328 or even $0.303, suggesting a risk of further price depreciation if selling pressure increases.