Cardano price sits above a crucial support level and may experience a bull run in May. Its daily volume in the spot market continued to rise, reaching $700 million today. Also, the open interest in the futures market is above its April lows. These factors, together with the positive weighted funding rate, means that ADA price could surge soon.
The ADA price today trades at $0.70, having risen by almost 40% from its April low.
Cardano Price Boosted by Rising Spot and Futures Volume
A potential bullish catalyst for the Cardano price is that signs of demand are emerging in the futures and spot market. CoinGecko data shows that the trailing Cardano volume jumped to over $700 million on Thursday.
This continues a trend that started late last month when the daily volume has averaged above $700M on weekdays. For example, its spot volume soared to $1.035 billion on April 25.
A rising volume, especially when a cryptocurrency is experiencing a surge, is a sign of increased demand from both retail and institutional investors. The volume on centralized and decentralized exchanges can also jump when a crypto is crashing, as holders sell.
In line with this, Cardano price could rise as the futures open interest in the futures market rises. Per CoinGlass, the open interest rose to $782 million on Thursday. While this figure is lower than its weekly high, it is much higher than the April low of $576 million.
Open interest is a crucial metric in the futures market, as it measures the number of unfilled call and put trades in the futures market. The interest often rises when a cryptocurrency is in an uptrend. A reversal usually happens when the OI overshoots, as it did in November and March.
Further confirming a potential Cardano price bull run is the fact that the funding rate has turned positive. It has jumped to 0.65, a sign that long position holders are paying a small fee to those predicting that it will fall. A positive figure provides a good ADA price forecast.
ADA Price Technical Analysis: Break and Retest Hints of a Bull Run
Cardano price is also exhibiting bullish technicals. The daily chart shows that the coin has formed an inverse head and shoulders pattern, a popular bullish reversal sign.
ADA price also formed a large falling wedge pattern, which is shown in red in the chart below. This pattern occurs when there are two falling and converging trendlines. These lines are drawn by linking the lower lows and higher lows in a certain period. Cardano has now moved above the upper side of the wedge. After doing this, it has retested that trendline, confirming a potential breakout.
On top of this, it created a double-bottom pattern at $0.5212, with a neckline is at $1.1705. Therefore, the most likely ADA price forecast is where it surges and reaches the resistance at $1.1705, up by 67% from the current level.
A drop below the double-bottom pattern at $0.5212 will cancel the bullish outlook. It will also risk the coin dropping to $0.2761, its lowest level last year.
The post Cardano Price: Bull Run Returns as ADA Trading Volume Surges to $700M appeared first on CoinGape.
