Short-term profitability analysis of Cardano (ADA)

Cardano, one of the most popular and promising cryptocurrencies on the market, is attracting major attention with a total market capitalization exceeding 70 billion USD (as of February 2024). More than simply a means of transaction, Cardano is also an ambitious smart contract platform, aiming to provide advanced features far beyond any previous protocol. 

What makes Cardano unique is that the platform is built on peer-reviewed research and developed through real-world evidence-based methods. The combination of cutting-edge technologies helps Cardano deliver unprecedented security, scalability, and sustainability for decentralized applications and systems.

In this article, we will explore the latest market updates and news about Cardano, while also hearing market analysis and strategies from experts and traders. Besides, the article will provide some practical investment tips and suggestions that can help you make money in the short term with Cardano. By the end of the article, you will have a better understanding of Cardano's current and future prospects, as well as how to leverage them to your advantage.

Notable developments and events

Cardano is making the whole cryptocurrency world stir with a series of important news and events taking place continuously recently. Let's take a look at some of the most notable information:

Smart contract officially deployed on mainnet

In February 2021, after months of testing and development, Cardano happily announced the successful activation of smart contract functionality on the mainnet. This is considered a turning point marking the project's remarkable maturity, creating conditions for developers to build and deploy decentralized applications (DApps) on this platform.

In parallel, Cardano also introduced Plutus Application Backend (PAB), a tool that simplifies the process of developing and integrating DApps with the Cardano blockchain.

Cooperate with Microsoft to integrate identification solutions

Cardano continues to make a splash with the announcement of a strategic partnership with Microsoft. The main goal of this collaboration is to integrate Cardano's Atala PRISM identity solution with Microsoft cloud services. Atala PRISM is a decentralized identity platform that allows users to create and manage digital identities, as well as verify personal information and access services. Partnering with Microsoft will open the door for millions of users and businesses to leverage the benefits of blockchain-based identity management, including security, privacy, and interoperability.

Cardano is the world's most staked cryptocurrency

As of December 2023, Cardano has officially surpassed Polkadot to become the world's most staked cryptocurrency, with the total staked ADA value exceeding 40 billion USD. Staking is a process that allows users to delegate their ADA to validators, who operate nodes and secure the network. 

In return, users will receive rewards in the form of ADA. Staking is not only a way to earn passive income with Cardano, but also an act of contributing to the sustainable development of the network and participating in Cardano's governance process.

The above information is only a small part of Cardano's recent success picture. Besides, the project is also actively implementing other initiatives, such as improving scalability, interaction and governance features, while expanding its ecosystem and community. These steady steps promise to continue taking Cardano to new heights in the cryptocurrency sky.

Market analysis and investment strategy

Cardano has been on a tear in recent months, defying the overall cryptocurrency market downtrend and reaching a new all-time high price. This boom can be explained by many factors, most notably the implementation of smart contracts and cooperation with Microsoft, which significantly increased the usefulness and applicability of ADA. However, the cryptocurrency market is still potentially volatile, and careful consideration is necessary before investing or trading Cardano.

Here's an updated analysis, combining previous insights with the latest developments:

Technical Analysis:

• Weekly chart: The price crosses the short-term moving average (SMA 20) signaling a change in trend. High trading volume supports this development, showing its sustainability. Notably, previous trading volumes remained low, suggesting the potential for further growth.
• Divestment cycle: The divestment cycle appears to be complete, meeting all the rules in the current price range ($0.26), considered a favorable buying zone.

Fundamental Analysis:

• Market context: The cryptocurrency market in general is in a bullish phase, creating a positive foundation for Cardano's rise.
• Elliot wave theory: Applying this theory to the weekly chart, we see:
  • Trend reversal: Price surpassing the last valid high point marks the end of the downtrend and the beginning of the uptrend.
  • Rising momentum: SMA 20, which previously acted as resistance during the downtrend, is now pointing up, confirming the trend change.
  • Accumulation phase: The subsequent consolidation phase followed by a rise in the SMA shows a typical accumulation pattern.
  • Increase trading volume: The recent increase in trading volume compared to previous bearish periods indicates significant buying pressure and the potential for continued upside.

Potential Price Target:

• Short-term: Based on Elliot Wave Theory, we are currently in wave 4, with the potential for wave 5 to reach at least $0.82.
• Mid-term: Based on the wave movements, wave 5 could reach $1.17-$1.20, completing this micro cycle before retracing and entering a sustained bull market.

Investment opportunity analysis/Investment orientation for Cardano

According to Tradingview, Cardano has just experienced a spectacular price increase, opening up attractive investment opportunities. However, the cryptocurrency market is inherently risky, requiring caution and a clear strategy. Below are updated shares, combining technical analysis, expert opinions and useful advice for you to make wise investment decisions.

Technical analysis:

• Be cautious but seize the opportunity: As Cardano sustains above the $0.607153 support, consider taking advantage of the current bullish momentum. Initial resistance target is $0.665890, followed by $0.721493 and even higher at $1.211600 if the trend continues strong. Note the possibility of price corrections and avoid trading against the trend unless there is a clear reversal signal.
• Elliot wave pattern: According to this analytical framework, wave 3 could end in the range of 227%-261%, potentially reaching $0.90. Prepare for a retracement in wave 4 (50%-61.8%), where wave B could provide support and provide a potential buying zone.

Some important recent developments:

• Ideal entry point: One analyst successfully opened an ADA position and predicts the price will continue to rise despite a possible broader market correction.
• Attractive profits: Another expert identified a profitable entry point, currently increasing to 20%, targeting $0.675 (previous peak of wave 3) to take profits.
• Always remember: Targets and predictions are not absolute guarantees. As the market fluctuates rapidly, these goals may not be achieved.
• Take profits at the right time: Curb greed and take profits at strategic points to manage risk.
• Independent research and analysis: Don't just rely on other people's predictions. Focus on research and personal analysis.
• Invest responsibly: Only invest the amount you are willing to lose. The cryptocurrency market is highly volatile, and losses are an ever-present risk.

Note:

• The price increase prediction of 4100% to $19 by December 2024 seems overly optimistic and should be viewed with caution. Such extreme targets often lack a solid technical or fundamental analytical basis and can be misleading.
• Focus on strategies that are realistic, sound, and appropriate to your risk tolerance and investment goals.

Conclude

While the cryptocurrency market is wobbling due to headwinds, Cardano is "swimming against the tide", continuously reaching new heights thanks to factors such as smart contract deployment and important strategic partnerships. This heat makes many investors excited, but remember that "it's okay to be careful." This analysis combines both technical and fundamental analysis to paint a detailed picture of Cardano's potential.

Technical analysis and trend show positive signals with price above the short-term moving average 20 (SMA 20) and strong trading volume supporting it. The divestment cycle appears to be complete, pointing to a favorable buying zone around $0.26.

Fundamental analysis, general market volatility in a bullish phase, and Elliot Wave Theory all point to Cardano's growth potential, with short and medium-term targets ranging from $0.82 to $1.20 .

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