Cardano Price Eyes $1 Breakout Amid Bullish Patterns and LTH Accumulation 

• The formation of an inverted head and shoulders bolsters the Cardano price for a rally to $1.
• The recent on-chain analysis highlights a steady accumulation from Cardano’s long-term holders, while the selling pressure from short-term holders is thin.
• A descending triangle in the daily chart drives a long-term sideways trend in ADA price.

ADA, the native cryptocurrency of the Cardano blockchain, bounced over 10% during Tuesday’s U.S. market hours to trade at $0.85. This buying pressure is likely following Ethereum’s high momentum rally as it inches closer to a new high, bolstering the altcoin market. However, the Cardano price witnessed additional momentum as the accumulation trend from long-term holders (LTH) continues to strengthen, while the selling pressure from short-term holders (STH) is limited. Is the ADA price ready for $1?

ADA’s Recovery Backed by LTH Accumulation and Diminished STH Selling Activity

In the past two weeks, the Cardano price showcased a V-shaped recovery from $0.68 to its current trading value of $0.847, projecting a 24.2% gain. The bullish upswing aligns with renewed buying pressure in the broader crypto market.

However, the on-chain data highlights that the ADA price is having firm support from long-term holders, while the selling pressure from short-term holders is scanty.

According to a recent tweet from analytics platform Alphractal, the LTH has been steadily accumulating ADA since 2021, with no major sign of distribution, as shown in the chart below. Their commitment to holding Cardano coin for such a long period reflects their confidence in the network, while it also reduces the supply available for selling.

Cardano: Supply Age Band

Meanwhile, the STH showcased a renewed shift towards the accumulation sentiment in the last few days amid a broader neutral behavior. During the 2021 cycle, these holders tended to sell aggressively as the ADA price rallied. However, no such pattern occurred this time, suggesting lower selling pressure.

Also Read: Dogecoin Price Risks Breakdown Below $0.21 as Futures Open Interest Slides

Cardano Price Forms Two Bullish Patterns For A Rally Above $1

The four-chart analysis of Cardano price recovery shows the formation of a classic reversal pattern called an inverted head and shoulder. The chart setup is characterized by three troughs, i.e., the left shoulder, the middle head, which represents a failed breakdown to the lower level, and the final right shoulder before the neckline breakout.

With today’s price jump, the ADA bulls provide a decisive breakout from the pattern’s neckline resistance at $0.83 amid a notable spike in trading volume. The momentum indicator Average Directional Index (ADX) at 17% accentuates that the recent price correction has helped buyers recoup the bullish momentum for the next leap.

If the pattern holds true, the coin price could jump another 16.6% to hit the $0.99-$1 target.

ADA/USDT – 4-hour chart

That said, a broader analysis of the daily timeframe chart shows the Cardano price could face intense supply pressure at $0.89 from the resistance trendline of a descending triangle pattern. Since November 2024, the ADA price has shown four reversals from the pattern’s bottom support trendline around $0.5 and three reversals from the downsloping trendline, validating its strong influence on shaping Cardano’s potential movement.

Typically, the chart setup supports a bearish momentum in price to offer a breakdown below key support. However, with the broader market uptrend and strong accumulation from long-term holders, a counter-analysis of a bullish breakout is possible. With the support of an inverted head-and-shoulder breakout, the ADA price could provide an upside breakout from the triangle, signalling the end of a major accumulation zone.

ADA/USDT – 1d chart

If materialized, the Cardano price could aim for a long-term target of $1.7.