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Cardano (ADA) is one of the most resilient coins on the crypto market. While Bitcoin has seen a 50% correction and revisited the opening of the year, ADA has traded well above its previous lows.
At the time of writing, ADA is trading at $ 1.14, down 2.7% and 4.8% on the daily and weekly charts, respectively.
The cryptocurrency managed to break into the crypto top 5 by market capitalization after Dogecoin (DOGE) and XRP lost their positions. The latter has been hit hard by the downtrend and is trading at $ 0.18 while XRP is trading at $ 0.58.
At its current level, Cardano (ADA) recently posted a Relative Strength Index (RSI), a metric used for the price dynamics of a cryptocurrency, which is 27 according to trader Eric Thies. He believes ADA was at a similar low on this metric in March 2020, ahead of the event called Black Thursday.
As can be seen in the chart below, ADA bottomed the RSI for the last time and saw price rise parabolically in the months to come. Thies believes this time it could be more positive as ADA rests on former ATHs.
In current market conditions, most coins tend to correlate with Bitcoin and its performance. Hence, the price of BTC needs to continue its recovery in order for ADA, ETH and other cryptocurrencies to rebound.
The pseudonym dealer Crypto Punisher has compared the trading pair ADA / ETH and found a positive outlook for the former. Ethereum has been one of the top performing cryptocurrencies in the past few months, but the trader believes Cardano (ADA) could take that place:
(…) Support at the macro level, as ETH continues to show strength. Given that ADA has held up strong throughout this downtrend, I think a rebound to outperform ETH in the short term is tempting enough in terms of R: R.
What could drive Cardano (ADA) to new highs?
One of the key factors that have influenced Cardano and its price performance is the upcoming launch of their Plutus smart contract platform. Input-Output Global (IOG) is currently testing the update in color-code phases, they have successfully completed AlonzoBlue, part one, and have entered AlonzoWhite.
Plutus will be launched in a hard fork combinator sometime in late 2021. IOG founder and Cardano inventor Charles Hoskinson did an Alonzo update on his YouTube channels and said:
Everything looks pretty good, it looks like it’s on schedule. The integration of the application backend is going according to plan, the integration of the wallet backend is going according to plan. We have a working Alonzo knot that survived the blue era. Now we are in the white era.
Hoskinson added that they were “mass onboarding people” to work with the test network, and Cardano’s developer was working on the new version for the Alonzo node. As the final implementation approaches, ADA may see additional benefits and break new ground.
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