Why is Cardano (ADA) Up 15% in a Week?

Last month, Cardano’s ADA collapsed below $0.14, the lowest level since the end of 2020. Meanwhile, its market capitalization briefly plummeted to roughly $5 billion, leaving the asset temporarily out of crypto’s top 20 club.

The bulls, though, managed to halt the free fall and even stage an impressive comeback. Here’s what happened and the possible catalysts behind the resurgence.

Green Week for ADA

As of press time, the token is worth almost $0.17, representing a 17% increase over the past 7 days. Perhaps the most evident reason pushing ADA higher is the broader market rebound following de-escalation news out of the Middle East.

Bitcoin (BTC) soared to $62,000, while Ethereum (ETH) surged past $1,700 amid reports that Iran and the USA are set to hold the next round of direct talks in the third week of July after the funeral of the supreme leader Ali Khamenei.

Another catalyst could be the excitement surrounding a Cardano upgrade scheduled to go live on July 6. Namely, this is the RealFi Phase 1 Testnet, described as “the first public step toward next-generation stablecoin infrastructure” on the project.

Speaking about the upcoming effort was Cardano’s founder, Charles Hoskinson, who called it “the largest upgrade” in the project’s history.

Numerous analysts noted ADA’s revival, arguing it has more fuel left to post further gains. X user Sssebi claimed the token “is on fire” and envisioned a short-term pump to $0.20, while Nehal predicted a jump to $0.23, provided the price holds above $0.16.

Not so Fast

ADA’s recovery shouldn’t be seen as a guaranteed start of a new bull run, as the crypto market remains quite unstable and vulnerable to another severe pullback.

The asset’s Relative Strength Index (RSI) reinforces the bearish outlook. The technical analysis tool, which ranges from 0 to 100, has risen above 70, indicating that ADA is in overbought territory and due for a possible correction. Conversely, ratios below 30 are considered buying opportunities.

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