The first half of 2023 has been challenging for Cardano (ADA), as the network failed to capture investor attention despite the continued development of the ecosystem and a promising forecast for the price of ADA. Along with the Securities and Exchange Commission (SEC) labeling ADA as an unregistered security, the price experienced a significant loss in its bullish momentum, struggling to recover from the bearish impact. However, ADA’s latest upward correction has led to bullish promises of a breakout above $0.3.
Cardano’s growth is on a declining path
Cardano’s development activity saw a significant drop, according to Santiment’s chart, indicating a negative signal for the blockchain. This decrease suggests that developers have put less effort into improving the network.
Furthermore, the data from Electric Capital reveals that Cardano was not in the top 16 in terms of developer growth. This has raised concerns within the community as many question the apparent deliberate boycott of the protocol and its development activities.
Despite these challenges, Cardano continues to publish its insights into ecosystem growth on a weekly basis, highlighting a consistent increase in the number of smart contracts published, token policies issued and transactions on the network.
The 1-week price volatility of ADA has dropped sharply. However, despite the price drop, ADA’s social dominance and transaction volume remained relatively high. On the upside, ADA’s open interest, as reported by Coinglass, has declined, which could possibly indicate an imminent end to the ongoing price trend.
What’s next for the ADA price?
Recently, Cardano’s price floated above the 20-day EMA by $0.28, and they were able to maintain these high levels. However, after reaching a high of $0.294, bears caused slight selling pressure due to a spike in the long liquidation, according to Coinglass. Currently, the price is consolidating in a bullish zone at $0.291, up 1.7% from yesterday’s price.
To keep the bullish ascending triangle pattern intact, the bulls must protect the uptrend line. If the price bounces back from this point, the bulls will try again to push the ADA price above the $0.3 resistance. If they succeed, the price could potentially initiate a new upward trajectory towards $0.33 and then $0.38. Since the RSI level is trading well above the centerline at a level of 59 and the SMA-14 indicator is trading in bullish territory, it indicates that bulls are in control of the price chart.
However, if the price drops below the downtrend line, the bullish pattern is negated and the altcoin drops to $0.26. This would suggest a period of consolidation between $0.23 and $0.30 for some time.