Cardano (ADA) has recently shown promising signs of a potential breakout, supported by favorable market conditions and growing optimism among traders. 

After fluctuating over the past month, ADA is now preparing to break key resistance levels, as positive investor sentiment and broader bullish cues give the altcoin a chance at recovery.

Cardano Has Support

Despite the volatility in the cryptocurrency markets, Cardano’s funding rate is currently positive. This suggests that long positions are dominating, as traders remain confident in ADA’s upward potential. The positive funding rate indicates that more traders are betting on the price rise, which signals optimism in the market for ADA’s future performance.

Over the past few weeks, however, market sentiment has been fluctuating. Still, the positive funding rate trend suggests that traders are preparing for a rally rather than a downturn. This shift towards long contracts over short contracts implies that investors are positioning themselves for a potential breakout as they anticipate higher prices in the near term.

Technically, Cardano’s market momentum is showing encouraging signs. The Relative Strength Index (RSI) is hovering near the 50 mark and could soon breach it into the bullish zone. An RSI crossing into this zone suggests that buying pressure is increasing, and ADA could experience a continued upward movement if this momentum is sustained.

If the RSI successfully moves above 50, it will further strengthen the case for a price rise. This indicator would reinforce the view that Cardano’s current price action is part of a broader recovery trend, supporting the case for a potential breakout in the coming weeks.

ADA Price Is Presenting an Opportunity

Cardano’s current price action suggests it is aiming to break out of a bullish descending wedge pattern. This pattern projects a potential rally of 26%, targeting $0.99. However, before confirming the breakout, ADA must secure $0.85 as support, which would validate the bullish outlook and set the stage for higher prices.

If Cardano successfully flips $0.85 into support, the altcoin could rally toward $0.99, potentially recovering most of the losses experienced in February. A successful breach of $0.99 would bring ADA closer to the $1.00 mark, significantly boosting investor confidence and supporting a sustained rally.

However, if Cardano fails to hold above the critical support level of $0.85 and momentum falters, ADA could fall back to $0.77. In this case, the price could slide further to $0.70, which would invalidate the bullish thesis and potentially delay Cardano’s recovery.

Story’s (IP) price has rallied by 189% a week after its launch, outperforming the top 10 artificial intelligence-based tokens. 

The momentum shows no signs of slowing down. With a 50% gain in the past 24 hours, IP currently ranks as the crypto market’s top-performing asset. With a strengthening demand for the altcoin, IP is poised to extend its rally in the short term.

IP Bulls Dominate Market

The setup of the token’s Moving Average Convergence Divergence (MACD) indicator confirms this bullish outlook. As of this writing, IP’s MACD line (blue) is positioned above its signal line (orange). 

The MACD indicator identifies an asset’s price trends and potential reversal points. It comprises the MACD line, signal line, and histogram, measuring trend strength and momentum shifts based on crossovers and divergences.

As with IP, when an asset’s MACD line rests above its signal line, it indicates a bullish trend. It means buying activity exceeds selloffs among market participants, hinting at the possibility of an extended rally. Moreover, traders interpret this setup as a signal to exit short positions and take long ones. 

Furthermore, readings from IP’s Awesome Oscillator (AO) confirm the significant bullish sentiment among its holders. Since IP’s launch, the indicator has posted only green, upward-facing histogram bars. 

This momentum indicator also identifies an asset’s trend strength and potential reversals. When set up this way, it signals an increase in bullish momentum. It means that IP’s short-term trend is gaining strength relative to the longer-term trend, which hints at the potential continuation of its current uptrend.

IP Battles Resistance at $6—Will Bulls Prevail?

Sustained demand for IP could drive its price past the $6 resistance level. A successful breakout above this may propel it toward its all-time high of $9 and potentially beyond.

However, once profit-taking begins, IP risks shedding some of its gains. In that scenario, its price could drop to $4.36, and if the bulls fail to defend this support, it may plummet further to $3.49.

The long-awaited altcoin season (alt season) has arrived, according to CryptoQuant CEO Ki Young Ju.

However, the analyst says this one plays by different rules, unlike previous cycles driven by a clear Bitcoin-to-altcoin capital rotation.

Analyst Calls Altcoin Season—But Not as Expected

Ju’s latest observations suggest that stablecoin holders, not Bitcoin traders, fuel selective altcoin gains while market liquidity remains constrained.

In a recent post on X (formerly Twitter), Ju declared that alt season has begun, citing a sharp increase in altcoin trading volumes. According to the analyst, the altcoin trading volume is now 2.7 times that of Bitcoin. However, Ju also noted that this is not a broad-based rally.

“It’s a very selective alt season…Only a few coins are pumping. With no fresh liquidity, it feels like a PvP fight over a fixed pie,” he wrote.

This assertion aligns with his earlier warnings. In January, Ki cautioned that the altcoin market remains a zero-sum game, with capital circulating among assets rather than seeing new inflows. In December, he also predicted that this alt season would be “weird and challenging,” favoring only select assets.

“Altcoins used to move together based on their correlation with BTC, but that pattern has now broken. Only a few are starting to show independent trends as they attract new liquidity,” Ki had written.

While some traders are excited, others remain unconvinced. RobW, a user on X, questioned Ju’s definition of alt season.

“A few tokens are pumping, so it must be alt season? None of the usual metrics apply, but it’s alt season if you pick really carefully, doesn’t sound like an alt season,” RobW challenged.

Similarly, DeimosWeb3 suggested that while some altcoins are performing well, the market has not yet entered a full-fledged alt season.

China’s Fiscal Moves and Crypto Markets

A parallel discussion in the crypto community involves China’s recent fiscal maneuvers. Some speculate that China’s economic policies could inject liquidity into global markets, benefiting crypto.

However, analysts urge caution, pointing out that China has not injected new capital but recalculated its M1 money supply to include demand deposits and prepaid funds.

“They didn’t inject new capital. They “recalculated” it to include other deposits and funds. There is no fresh print,” a user on X articulated.

Local media confirms this, indicating that the People’s Bank of China, the country’s central bank, will include these elements starting in 2025.

Crypto and DeFi researcher NFT Bear highlighted that this change led to a dramatic 67.59% increase in reported M1 supply. However, he emphasized that it does not equate to fresh liquidity hitting financial markets.

Historical comparisons to the US’s 2020 money-printing frenzy have also surfaced. The US quickly increased its M1 money supply back then, fueling a 16x surge in altcoin market capitalization.

While China’s current actions differ, some traders speculate that even a fraction of new liquidity flowing into crypto could trigger another bull run.

“Whether or not this translates into another explosive crypto rally remains to be seen. But one thing’s for sure: when a major world economy infuses liquidity—no matter how it’s measured—financial markets tend to take notice, and crypto is often at the center of that conversation,” NFT Bear indicated.  

Despite the uncertainty, some altcoins have outperformed. Projects like Sei (SEI), Sui (SUI), Zksync (ZK), and Story (IP) have attracted attention, possibly signaling emerging narratives in the space.

Whether these gains are sustainable or merely temporary surges in a fragmented market remains to be seen. Nevertheless, analysts agree that the traditional altcoin season metrics no longer apply.

The crypto market is changing, with Bitcoin acting as a paper-based asset through ETFs (exchange-traded funds) and institutional funds. Instead of a broad BTC-to-alt capital rotation, altcoins appear to be carving out independent narratives and utility to attract capital.