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Cardano is regarded as the third-generation cryptocurrency due to its potential applications. With smart contracts on the horizon, ADA investors appear to be overjoyed at the prospect of profiting from their investments. Could the next infrastructure bill, however, cut Cardano’s run short? And what are the investors’ reactions to these changes?
The bill and the next critical level for Cardano
As most of the crypto space has heard, the new infrastructure bill aims to amend the cryptocurrency tax rules. According to the bill and a recent amendment to make it more stringent, “brokers” will be forced to record their gains. This is in addition to reporting any transactions above $10,000. However, with the law receiving widespread criticism, the issue now is, where will Cardano go from here?
Looking at the key levels identified by analyst Dan Gambardello in his recent YouTube video, it appears that an uptrend is possible. Cardano is finally testing the bull market doors of the Fibonacci tool on the daily chart, as the candlestick ended above the 1.618 level. This is usually a strong indication of an uptrend. Furthermore, this movement is similar to the 2019 bull run behavior.
However, because the market is entering a corrective period, this rally may be cut short. In such case, ADA might find support near $1.2, while $1.5 represents resistance. Furthermore, the altcoin broke out of the falling triangle on the BTC pair and landed on support. Swing lows position this support near 3250 sats, and an upward movement appears improbable unless ADA really tests this.
Do investors agree?
Bears appear to be ruling the market in terms of buying and sell-offs at the moment. Furthermore, volatility has decreased by about 100 percent in the last two months. Volatility was above 150 percent in June when we saw a little bear run. While this is a positive sign, larger market indicators remain unfavourable.
Finally, the number of new and active addresses has decreased substantially, reaching 0 on August 1. When this data is considered, it is evident where ADA could be heading.