Cardano Price Analysis: Will ADA Reverse After Bitcoin's Bullish Breakout Above $71K?

Amid the highly anticipated altseason in the near term following the Bitcoin (BTC) bullish breakout above $71k, Cardano (ADA) has signaled an imminent reversal in the near term. The large-cap altcoin, with a fully diluted valuation of about $15.5 billion and a daily average traded volume of more than $373 million, pumped over 2 percent in the last 24 hours to trade about 34 cents on Tuesday, October 29, during the early New York session.

Cardano Price Signals Imminent Reversal Ahead

Having been trapped in a macro correction for the past seven months, Cardano price against the US dollar has signaled an inevitable reversal in the near term. The layer one (L1) altcoin has been gaining bullish momentum in the past four months, having formed a weekly reversal pattern, characterized by a double bottom and a bullish divergence of the weekly Relative Strength Index (RSI).

According to crypto analyst Ali Martinez, ADA price has been following a similar fractal pattern to the 2020 bull market. As a result, Martinez is confident that ADA price will rally towards a new all-time high in a parabolic bull market in the coming months.

Moreover, the ADA/BTC pair has been retesting the multi-year low, after being trapped in a falling trend since the fourth quarter of 2021.

Cautionary Take

The Cardano network has registered a stagnant growth in its total value locked (TVL) in the last year, compared to other upcoming L1 led by Solana (SOL), and Toncoin (TON). Despite notable developments, including the recent integration with the BOS bridge to tap into Bitcoin, the Cardano network has not ignited much-needed on-chain activity.

According to market data analytics firm IntoTheBlock, ADA price could soon pull back due to low on-chain activity.