Cardano shows strong recovery signs as ADA confirms bullish double bottom pattern

Cardano price has formed a double bottom pattern, potentially paving the way for an eventual recovery back above $1 in the weeks ahead, backed by bullish developments and on-chain strength.

According to data from crypto.news, Cardano (ADA) rose to an intraday high of $0.74, up 25.5% in the last 7 days and 42% from its year-to-date low. As of press time, it held 3.9% gains over the past 24 hours with a market cap of $27 billion.

ADA price gained traction today after Emurgo, one of Cardano’s founding teams, announced the launch of the Cardano Card, a new multi-functional payment and finance tool designed to turn ADA into a spendable, yield-generating asset.

While presented as a crypto card, the product’s scope extends well beyond payments. It will eventually allow users to stake ADA, earn yields from DeFi and real-world assets, access collateralized loans, and direct a portion of the card’s profits into the Cardano treasury.

In addition to the announcement, on-chain metrics have also turned positive for ADA. Data from DeFiLlama shows that total value locked in ADA across all protocols has jumped by 93% over the past 7 days, pointing to rising capital inflows and renewed interest from investors.

Since the start of July, the total TVL within Cardano’s DeFi protocols has climbed by 28%, reaching $438 million. A rise in TVL often signals more network activity, better liquidity, and higher user participation, factors that can support a price increase as demand builds.

Meanwhile, data from CoinGlass shows a shift in sentiment, with Cardano’s weighted funding rate climbing to 0.012% after being negative earlier this month. A consistently positive funding rate usually means more traders are betting on the price to go up, reflecting stronger confidence in its short-term outlook.

ADA price analysis

On the 1-day/USDT price chart, ADA is closing in on a crucial resistance level, a break above which could lead to a sustained rally in the short term.

Notably, ADA has been forming a double-bottom pattern since March, with support at $0.50 and a neckline at $0.76, a setup typically seen as a bullish reversal signal.

ADA price, 20-day and 50-day SMA chart — July 16 | Source: crypto.newsAdditionally, the 20-day simple moving average appears poised to cross above the 50-day moving average, a formation known as a bullish golden cross in technical analysis.

Hence, if ADA manages to break above the neckline at $0.76, the projected target would be the $1.03 level, which also aligns with the 78.6% Fibonacci retracement level. The target is 35% above the current price level.

Analysts believe ADA’s rally could be the beginning of a broader bull run, with some projecting more ambitious targets in the $3 to $5 range.