Will ADA freefall to $0.38?

June 17, 2024

Reading time: 5 minutes

Cardano’s future looks troubling as network activity plunges to a 3-month low

Key points:

  • Cardano’s active addresses dropped to a three-month low of 20,400.

  • ADA’s price and network activity showed a strong correlation.

News - Market participants seemed to prefer other blockchains over Cardano of late, as the latter’s number of Active Addresses dropped to 20,400, a 3-month low.

AMBCrypto’s analysis noted that there was a strong correlation between ADA’s price and Cardano’s network activity. Since Cardano is not exactly trending at this time, unlike its contemporaries - Solana and Ethereum - investors seem to be moving away from it.

Effects on ADA - ADA had not been performing well in the past seven days - it saw a fall of 6.48% after a 1-month decline of 14.98%. However, its fortunes seemed to be turning at press time, as it saw a loss of only 0.80% in the last 24 hours, with an uptick seen in its price, which stood at $0.41.

But if the number continues to drop, ADA might decline to $0.40. In a highly bearish condition, the price of the token might fall to $0.38.

Weighted Sentiment is a key indicator that could affect the token’s price. It shows the perception that market participants have about a project online.

If the reading is positive, then it means most conversations are bullish. However, a negative value of the sentiment implies that a lot of comments are bearish. For Cardano, at press time, it was the latter.

During this period, Cardano’s RSI was 33.10. This was a majorly bearish signal, showing that ADA could have trouble staying above $0.40 in the near future.

Celebrity meme coins gain favor among participants, new research shows

Key points:

  • More market participants are looking to trade in celebrity-related meme coins.

  • However, this trend could be a result of the lack of understanding of the crypto space.

News - According to Kucoin’s latest report, crypto market participants are increasingly turning their attention to celebrity meme coins with “relatively obscure low-market-cap assets.” In doing so, investors are moving away from new projects with high initial valuations and limited wealth generation options.

Notcoin was the catalyst of this changing trend. It simply started out as a trading token for games on Telegram, but soon burst onto the scene, with a price of $0.01809 at the time of writing.

The report noted, “After some time on the market, by the end of May, both the price and trading volume of NOT saw significant growth. This also boosted the overall market attention towards its Tap To Earn and Minigame products.”

As a result, NOT helped the Toncoin ecosystem. Notably, Catizen, a TON ecosystem game, has seen explosive growth over the past few weeks, with over 6 million users and 8.1 million transactions.

Why are investors moving to meme coins? Simply put, investors are moving towards “Attention Assets.“ Those who have a limited understanding of the cryptocurrency space are investing in spaces spearheaded by celebrities they trust.

However, such blind trades are prone to risks. Recently, there emerged speculation of Andrew Tate engaging in insider trading with his DADDY tokens. So, it is always better to consult with trusted and seasoned investors in your own circle.

What are the factors behind Ethereum’s price growth?

Key points:

  • More Ethereum traders have started to open positions in the market, indicating rising speculative activity.

  • Whales accumulated over 700K ETH worth $2.45 Billion in the past three weeks.

News - One day after Ethereum’s Open Interest dropped to $13.14 billion, it added another billion to its value. As of this writing, ETH changed hands at $3,544.65 representing a slight 0.29% increase within the last day.

But by the look of things, this could be the start of a significant uptrend.

Ethereum’s whale movements were also optimistic. Recently, large-scale investors accumulated over 700,000 ETH in the past three weeks, a total of approximately $2.45 billion. This showed that these large investors believed in the altcoin’s long-term potential.

Bears dominate, ETH struggles - However, this accumulation wave wasn’t enough to break Ethereum’s bearish trend. After ETH exhibited a double top pattern during this period, its price started to exhibit lower lows and lower highs. For ETH to break out of this bearish pattern, its CMF needs to breakout. However, this was not the case, as it was declining at press time.

Also, Ethereum’s Funding Rate has remained stagnant since 8 June, and its Taker Sell ratio was 0.50 at press time. A combination of both these factors suggests that Ethereum will have a hard time breaking out of the $4k mark.

On-chain data was bearish as well. Active Addresses fell significantly over the last few days, showing that investors weren’t willing to buy ETH at its current prices. ETH’s Velocity had plummeted drastically, at a meager 2,967 at press time.

‘Bitcoin, Ethereum ETFs not the end?’ Tether CEO drops his prediction

Key points:

  • Wall Street’s “greed” will ensure that crypto ETFs keep rolling in, per Tether co-founder William Quigley.

  • Bitcoin is projected to hit $86k by the end of 2024, spurred by the efforts of miners.

News - After Bitcoin and Ethereum, major altcoins like Solana and Cardano can also see ETF approvals, according to Tether co-founder William Quigley.

While noting that Wall Street is “greedy,“ he said, “Every time Wall Street packages a new product to sell to consumers, if that product is successful, you can guarantee there will be copycats. There would be no ETFs if the Bitcoin ETF had failed.”

Bitcoin ETFs, after their launch in January, were an instant hit, propelling BTC’s price to new highs of $73k. Since its hype cleared, however, the market started awaiting the launch of similar products. Ethereum ETFs, the next big thing, are eagerly awaited by market participants, especially following positive signals from regulatory authorities. The funds received initial approval in late May, but will not start trading until funds’ S-1 registration forms are approved.

However, Quigley expressed concerns that Wall Street's aggressive marketing of crypto products could lead to significant risks, especially if institutional investors pull out during market downturns.

Bitcoin miners - In a spot of good news, Bitcoin’s miner costs had increased to $86k. If historical trends are to be considered, then BTC may surge exponentially soon, as the king coin has always traded above its average mining cost.

In reality, though, the king coin has not been so lucky. Per CryptoQuant, BTC’s net deposit on exchanges was high compared to the last seven days’ average. Its Coinbase Premium was negative, meaning that selling sentiment was dominant among U.S. investors.

Did you know?

  • Only 61 (1%) of the 4,568 Bitcoin blocks were opened by unknown addresses from 15 May to 15 June 2024. The other 99% were opened by mining pools. This is a troubling sign. As more miners start to sell to cover their operational costs, the market will become wrought with a surplus of BTC, causing downward pressure on prices.

  • On the topic of miners, the average cost of mining Bitcoin per year is  $4.45 Billion. So not only are miners having to pay hefty prices, the impact on the environment isn't looking too good as well. About 60% of Bitcoin’s hash rate today depends on non-renewable energy sources — Coal-based technology is a key drive. This releases emissions, which could cause a more than 2-degree jump in temperatures worldwide.

  • The global adoption rate of cryptocurrency is 4.2%, with over 420 million users worldwide. Of this group, 57% said they made money investing, 16% feel neutral about gaining or losing money, 14% have lost money, and only 7% feel like they made a lot of money from crypto investing. 

Top 3 coins of the day

dogwifhat (WIF)

Key points:

  • The sentiment around WIF remained bearish, with the 14-day RSI flashing buy signals.

  • Its Fear and Greed Index was 71, showing immense greed in the market.

What you should know - WIF remains a clear investor favorite, with its price having risen by 3.13% over the last 24 hours. Its market cap was 2.5 billion, having risen 2.92% in the last 24 hours. This is a major feat for a token that was launched merely four months ago - today, it is the third-largest meme coin, just behind DOGE and SHIB. At press time, its price was $2.52, and WIF was in a continued uptrend. If the momentum holds, WIF might reach the resistance levels of $4.3432, and $5.6428. However, if the trend reverses, then the price of WIF may fall to the support of $2.8704, and $1.9557. The RSI was at 48.39, showing that buyer/seller sentiment remained neutral, at the time of writing.

Notcoin (NOT)

Key points:

  • NOT flashed bullish signals as the broader market sentiments remained bullish.

  • The Fear and Greed Index was 71, with a 50.47% price volatility over the last 30 days.

What you should know - Following its listing on Binance, Notcoin surged exponentially, reaching its all-time high of $0.00865 on 27 May. However, it has started to decline of late, experiencing a 10.14% plunge in the last 24 hours. Its market cap dropped 10.08% as well, reaching 1.8 billion. The RSI was 40.59, showing that investors had potentially started to sell. If this trend continues, then a price correction is evident. The MFI, at 46.30, had started moving downward which can be considered as a bearish sign. Per NOT’s long-term projections, if the token can reach $0.035 in 2024, then a new all-time high of $0.047 is not far off. Conversely, investors can expect a new support level at $0.0266.

Maker (MKR)

Key points:

  • MKR’s market sentiment remained bearish even as the Fear and Greed sentiment was flashing a Greed signal at 71.

  • In the last 30 days, MKR has seen 8.19% price volatility.

What you should know - Maker rose 3.43% over the last 24 hours, with the price at $2,385.65 at press time. Its trading volume increased by 84.37% in the last 24 hours as its market cap rose 3.32%, sitting at 2.2 billion at the time of writing. Over the past 7 days, MKR saw a good upward trend, with its price having risen by 11.53%. However, the broader market trend remains bearish. MKR’s RSI was 57.03, showing that investors were not too keen on buying MKR. The MFI, on the other hand, at a level of 75.12, showed a southward trend at press time, showing that bears had started to sell.

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