Cardano Rises to 5-Month High as Shorts Get Crushed, $0.30 in Sight
Cardano's price surged to a five-month high of $0.27, a 10% gain on the daily charts, as the altcoin successfully held $0.24. The price jump came alongside a significant increase in market activity, with spot trading volume rising by 297%.
Despite the price increase, bearish positioning persisted in the derivatives market, with traders deploying more capital into the market and increasing their outstanding positions. The open interest in the derivatives market surged 18% to $635 million, while derivatives volume jumped by 355%.
However, the rally has yet to win over those traders who are still shorting Cardano, with a bearish skew across tracked exchanges. The long/short ratio plunged to 0.71, indicating a bearish bias in the market.
The latest gains coincided with rising exchange deposits, with Cardano's spot net flow remaining positive for two consecutive days. However, this could indicate preparations to take profits, which could slow the rally if ADA holders sell their tokens.
Despite potential selling pressure, the altcoin's true strength index formed a bullish crossover, suggesting strengthening upside momentum. Cardano also climbed above its 20-day exponential moving average, which stood at $0.24. If buyers can maintain pressure, ADA could target $0.28 and $0.30, but a break below $0.24 could open the way toward $0.22.