Cardano ADA gives early signals of a rally. Is this a good opportunity?

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  • Cardano recovers 4% on Wednesday after hitting a two-year low

  • whale activity has been reported to increase

  • The Cryptocurrency Remains in a Downtrend With No Confirmation

Cardano (ADA/USD) is moving to a higher level after hitting a two-year low of $0.24. Trading at $0.265 at press time, ADA posted a 4% return on the day. The day’s gains came amid an increase in whale activity.

According to data from WhaleStats, ADA was among the top 10 most-bought tokens on December 04, overshadowed by the largest BSC whale. BNB whales now hold a combined 19.9 million Cardano tokens. The portfolio, which is worth $5.19 million, however, represents less than 1% of the total. However, large investors have reduced their ADA positions in the last 30 days. This potentially explains the massive decline in ADA price to multi-year lows in December.

There are no clear indications for the recent surge in ADA. First as CoinJournal Reported, sentiment data showed that ADA was undervalued until the end of 2022. But we remain cautious as ADA is in a downtrend.

ADA recovers at bottom of descending channel

ADA/USD Chart by TradingView

From a technical perspective, ADA is on a relief rally from the lower edge of a descending channel. The 2-year low saw the RSI reach the oversold level, which means investors had dumped ADA in huge proportions. The technical outlook on the daily chart still supports the bearish view of the cryptocurrency.

Will the ADA recovery continue?

Cardano’s recovery is tied to broader crypto sentiment. very cryptocurrency Posted relief recovery on Wednesday but still trading at depressed levels. There is no confirmation that the recovery will last since we remain in a bearish market.

If ADA sustains the recovery, we need to see how the bulls play out at the upper end of the descending channel. Conversely, ADA remained weak at or below the $0.24 level.

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