Cardano (ADA) has recently witnessed a notable dip in its Market Value to Realized Value (MVRV) ratio. This development has captured the attention of market veterans, including Ali Martinez, who affirmed its significance as a bullish indicator for Cardano amid the prevailing market downturn.
It’s worth noting that Cardano has been a victim of the broader crypto market crash, with its price plunging by 20% since April 12. The digital asset’s woes began on April 9, following a period of sustained price growth that saw it reclaim the coveted $0.62 territory. However, the subsequent market turbulence led to a price collapse, causing ADA to relinquish pivotal support levels ranging from $0.62 to $0.59.
After consolidating for two days following this sharp decline, Cardano witnessed an even steeper drop on April 12 and 13. During this period of downturn, its MVRV ratio suffered a massive crash, plunging to -22.08, according to data from Santiment.
The last time #Cardano's MVRV Ratio dipped below -22%, $ADA's price soared by over 75%. With the #ADA MVRV Ratio back under -22%, we could see another impressive rebound! pic.twitter.com/ABf0mp4pR4
— Ali (@ali_charts) April 19, 2024
Ali noticed intriguing Cardano chart
Notably, Ali Martinez noticed an intriguing pattern on the charts whenever Cardano experiences a significant decline in its MVRV ratio. Specifically, ADA’s MVRV ratio also crashed to -22 last June, when the token experienced a drastic 41.6% decline from $0.3773 on June 3, 2023, to a low of $0.2200 on June 10, 2023.
Following this drop in the MVRV ratio, Cardano embarked on an impressive price run, appreciating by 75% above $0.37 in July 2023. However, this 75% surge took over a month to materialize amid sustained growth. Ali Martinez expects this pattern to repeat, rooting for what he dubs “another impressive rebound.”
At its current price of $0.4656, a 75% surge would propel Cardano to $0.8149, marking a 2-year high for the digital asset. The last time it saw this projected price level was in May 2022. To clinch this target, however, Cardano would need to breach multiple resistance levels, with the last one stationed at the March 14 high of $0.8090.
Data from IntoTheBlock confirms that Cardano faces two massive sell walls before reaching the $0.81 price point. The first sell wall rests between $0.5238 and $0.6007, where 355,100 addresses hold a staggering 4.49 billion ADA. The second lies within a range of $0.6007 to $0.7268, featuring 336,990 addresses with a balance of 6.72 billion ADA.
Despite these formidable resistance levels, Ali Martinez’s vision for Cardano extends beyond the $0.81 mark. Last week, the analyst reaffirmed his conviction that Cardano could potentially hit an ambitious target of $9, despite the current market downturn.
