Cardano (ADA) price is up by 1.25% today, August 6, to trade at $0.194 at the time of writing. The gain comes despite a 33% decline in ADA futures trading volumes and a fall in Cardano’s DeFi Total Value Locked (TVL) to its lowest point since 2023.
Cardano Futures Volume and Open Interest Drop
Data from Coinglass shows that the futures volumes on Cardano have dropped from $884 million on August 4 to $591 million on August 6. During the same period, the price of Cardano has moved from $0.199 to $0.1904 at the time of writing.
Cardano’s open interest has also dropped by 5.8% today, August 6, to $480 million at the time of writing, suggesting that the speculative demand for Cardano is dropping as the price retraces from the recent multi-week high of $0.199.
CoinGlass also shows that Cardano’s funding rate has turned negative, and this suggests that short sellers are willing to pay a higher fee to keep their positions open as they bet that the price of ADA will drop, especially with falling odds that the CLARITY Act bill will not pass.
DeFi TVL Drops to 2023 Lows Despite Upcoming Network Upgrade
Data from DeFiLlama shows that the TVL on Cardano has dropped to 358 million ADA, with this being the lowest point reached by this TVL since March 2023.
The drop comes despite hype around the upcoming Cardano network upgrade that will make the network up to 60 times faster.
DeFiLlama also shows that the DEX volumes on Cardano have dropped from $2.93 million on August 2 to $1.46 million on August 6, with this also suggesting that activity on the Cardano network is dropping.
Cardano Price Prediction as Double Bottom Pattern Forms
Cardano price is trading within a double bottom pattern whose appearance often suggests that bulls are tightening their grip.
ADA has also closed above the resistance at $1.80 for four straight days, suggesting that the long-term Cardano price forecast is bullish.
The price of Cardano gained by 17% when it moved from the support of $0.154 to the resistance at $0.180. If it replicates this rally after closing above the resistance of $0.180, the price of Cardano could reach $0.21.
The RSI reading of 67 suggests that the momentum is favoring bulls. This RSI reading also shows that Cardano is still not overbought despite the recent surge in buying pressure, suggesting that there is room for more gains to occur.
The MACD line that is positive and rising also suggests that the bullish momentum is becoming strong.
Cardano will invalidate this bullish bias if the price closes below $0.180. Dropping below this price would deem the double bottom invalid and selling pressure could rise if ADA sustains three daily closes below it.
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