Cardano (ADA) Primed for 2x Gains if History Repeats: Data



Cardano’s price took turn for the worse after the much-anticipated Vasil upgrade, as it fell to the lowest level since February 2021. ADA is currently on the way to posting the seventh red monthly candle in a row.

The ADA price correction gained traction in the wake of a downtrend across the digital asset market spurred by the Federal Reserve’s aggressive interest rate hikes to suppress rising inflation. In fact, ADA declined by over 20% since the hard forkwhich aimed at ramping up its network’s scalability and smart contract capabilities.

Despite the dwindling investor confidence, there could be a change in the trend.

Is Cardano Undervalued?

According to the crypto analytic platform, Santiment, Cardano is sitting at its lowest relative position compared to its realized value since January 2019, a sign of undervaluation based on average trader losses, which can prompt an uptick in the token’s price.

Data suggest that ADA’s MVRV Z-Score has hit -1.35 for the first time in 45 months. The Market Value to Realized Value (MVRV) depicts the ratio between the current price and the average price of every asset acquired. Its value essentially gives an idea of ​​how much overvalued or undervalued this asset is. An increase in ratio signifies a sentiment of sell pressure among the holders as the potential profits increase.

The last time ADA’s MVRV Z-Score was at this level, the token’s price doubled over the next three months.

Taming the Bears

A pseudonymous cryptocurrency trader DonAlt recently stated that Cardano could see the same fate as once popular fixtures in the top-ten leaderboard – EOS, Litecoin, and Bitcoin Cash. Before the previous bull run, these three assets managed to climb next to some of the biggest cryptos, but their popularity soon took a hit. Litecoin, for one, briefly exited the top-twenty positions on CoinMarketCap.

At press time, Cardano was trading at $0.35 after a surge of nearly 5% over the weekend.

On the tech side of things, the network witnessed a substantial uptick in terms of stakers. While the number of stakers has mostly remained consistent, even growing by more than 30% over the past 30 days, the depreciating revenue is a cause of concern.

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