Cardano's native token ADA has surged 3.5% in the past 24 hours to trade around $0.17, as analysts point to a bullish technical pattern and increasing whale accumulation. Some experts predict a potential rally to new all-time highs, though an overbought RSI signals caution.
Bullish Technical Setup
Analyst CryptoJack highlighted the formation of an inverse head-and-shoulders pattern on ADA's chart, a classic reversal signal that suggests sellers are losing control. The pattern comprises three lows — a left shoulder, a deeper head, and a right shoulder — typically indicating buyers are gaining momentum.
Celal Kucuker went further, stating that ADA may have reached its bottom and could be on the verge of a "parabolic" rally toward a new all-time high of $5. "I expect the parabolic rally to begin," he said, reflecting optimism among some traders.
Whale Activity Supports Upside
On-chain data reinforces the bullish outlook. Whales holding between 100,000 and 100 million ADA have increased their total holdings to over 25.6 billion coins, while smaller wallets with fewer than 100 ADA have reduced their exposure. This divergence suggests large investors are accumulating while retail players sell.
Additionally, ADA's exchange netflow has shown consistent outflows exceeding inflows over recent weeks, indicating investors are moving tokens to self-custody and reducing immediate selling pressure.
Bearish RSI Tempers Optimism
Despite the positive signals, ADA's Relative Strength Index (RSI) has climbed above 70, entering overbought territory. Historically, an RSI above 70 suggests the asset may be due for a pullback, while readings below 30 are considered buying opportunities.
The mixed signals mean traders should watch for a potential short-term correction even as the longer-term outlook remains constructive. The recent US CPI data showing cooling inflation provided a macro tailwind for the broader crypto market, but technical resistance could slow ADA's ascent.