Open Interest Surges…Cardano Signals Readiness for Rise

▲ Cardano (ADA)/ChatGPT generated image ©

While Cardano has been consolidating without clear direction, subtle buying signals detected in the derivatives market are stimulating the possibility of a rebound.

According to investment media FXStreet on May 4 (local time), Cardano (ADA) showed a slight upward trend from the early $0.25 range, taking a breather after last week's correction. On-chain indicators are neutral, but a limited bullish trend is observed in the derivatives market.

According to CoinGlass, Cardano's open interest increased to $465.52 million, steadily expanding from $433.60 million last Friday. This indicates an influx of new funds and increased market participation, interpreted as a signal suggesting a potential short-term rise.

Funding rates have also turned positive. The OI-weighted funding rate entered the positive territory at 0.0072%, forming a structure where long positions pay costs to short positions. This shows that investors are betting on an upward movement.

Technically, downward pressure appears to be easing. Cardano currently remains below the 50-day exponential moving average of $0.255, maintaining a short-term bearish structure, but its Relative Strength Index (RSI) has risen above the neutral line to 54, slowing down its downward momentum. The Moving Average Convergence Divergence (MACD) also shows a slight positive trend, suggesting limited upward attempts.

Overhead resistance is formed in the $0.255, $0.269, and $0.286 ranges, with strong resistance awaiting near $0.299. Conversely, at the bottom, $0.243 serves as a key support level, and a break below it could lead to further decline.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*