As the cryptocurrency market continues to bleed, eminent projects like Cardano (ADA) are witnessing considerable negative sentiment from the crypto community. However, despite the phenomenal rise in negative sentiment, ADA is backed by bullish statistics.
According to the on-chain and social metrics firm, Santiment – Cardano’s price is down by nearly 70% this year, further triggering a negative social sentiment toward the crypto. Nevertheless, the firm highlighted that the last time the crowd was this negative in January, “ADA rebounded +24% in 5 days until sentiment turned positive again”.
Furthermore, a simple social metrics analysis of ADA deciphers that a negative reading only ascertains that more holders will incur losses if they sold the cryptocurrency at the prevailing price. In light of this, an investor typically sells for profit and buys during the dip, further determining that Cardano’s price could potentially be in a prime position to make a hasty recovery as holders, especially whales, take advantage of the lower price levels to fill their bags.
ADA To See Recovery Post BTC Bulls?
Subsequent to the rest of the crypto market, the dominant cryptocurrency, Bitcoin is also currently undervalued and oversold according to Fidelity Investments’ director of global macro, Jurrien Timmer’s analysis. Last month, the Fidelity executive took to Twitter explaining why he is bullish on BTC. He referred to Bitcoin’s price/network ratio, pointing out that valuation is more important than price.
While using the P/E metric for BTC, Timmer emphasized that the BTC price is currently bleeding, but its actual valuation continues to be higher than the present price pattern. Timmer explained that BTC’s price is running below the network curve, further confirming that the cryptocurrency is undervalued.
Following this, Timmer asserted that BTC is also oversold, explaining his theory using Bitcoin’s dormancy flow chart. The fidelity executive elaborated on how BTC is oversold by overlaying its value against the price of spending behavior. Timmer tweeted that the “chart shows how technically oversold Bitcoin is”, further adding that the “dormancy flow indicator is now to levels not seen since 2011”.