The ADA bulls have pushed the price higher as excitement grows over the upcoming SundaeSwap DEX launch.
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Cardano (ADA) has been trading within an impressive distance of its three-week high earlier this week, leading some investors to suggest that a trend reversal has already taken place. In fact, the bullish momentum is mainly connected with anticipation of the upcoming decentralized exchange (DEX) called SundaeSwap.
The ADA price rallied nearly 12% on Jan. 17 to hit an intraday high of $1.60, a day after SundaeSwap announced the launch of a “fully functional beta decentralized exchange (DEX)” “. However, the uptrend also comes as part of a broader recovery trend in which ADA has rallied nearly 50% in just seven days.
Specifically, the ADA rally started almost in sync with similar retracement moves in the crypto market. That includes Bitcoin (BTC), which drastically reversed its trend on January 10 after its price dropped to as low as $39,650. At press time, BTC price trades at $41,500.
ADA initially followed the crypto market reversal, but then resumed its own upward momentum after taking cues from the excitement surrounding the SundaeSwap DEX launch on Jan. 20. Hence. , ADA emerged as one of the best performing among the ten cryptocurrencies based on a 24-hour adjusted timeframe.
What makes SundaeSwap bullish for ADA?
SundaeSwap’s official DEX launch announcement includes evidence of greater demand for the ADA token in the future, and this is usually a bullish signal for investors.
The moment we’ve all been waiting for has finally arrived!
We are excited and proud to share that SundaeSwap and ISO will be launching on Thursday, January 20th (EST) night!
Check out the article below! https://t.co/8oDYU6i3k9 pic.twitter.com/upgNZx2xH2
– SundaeSwap Labs (@SundaeSwap) January 15, 2022
The DEX platform also showcased its native SUNDAE token and discussed three ways to distribute it among users: through an initial share offering (ISO), profit farming, and direct conversions. based on exchange.
Discussing the ISO round, SundaeSwap explained that they will distribute 5% of the total SUNDAE supply through five epochs. Each epoch represents a five-day reward cycle in which users entrust their ADA tokens to a pool of shares.
“If you want to make sure you qualify for all five ISO bonus rounds, you have to bet ADA with qualified SPOs [Stake Pool Operators] before 21:45 UTC on January 25th”, the DEX message read, adding:
“Your reward will be calculated based on the snapshot taken at that time and simultaneously at each subsequent epoch boundary.”
Meanwhile, the yield farming program has seen SundaeSwap add four more ADA-based liquidity pools: SUNDAE/ADA, LQ/ADA, WMT/ADA, and Cards/ADA. The DEX also allocates 500,000 SUNDAE per day from January to June.
ADA to 2 dollars?
The recovery led by SundaeSwap pushed ADA towards its 100-day exponential moving average (green wave 100-day EMA) near $1.57.
Additional bullish signals also come from the tentative launch of Pavio, the first of the Cardano metaverse to take on.
Pavio is a Decentraland-like virtual land startup with around 100,000 plots of land, each of which is minted as a unique non-traceable token (NFT) with coordinates. The introduction of Metaverse in the crypto space over the past months and Cardano’s involvement in it could boost demand for ADA even further.
Related: Meta employee poaching from Microsoft and Apple for metaverse plans
This increases the likelihood of Cardano closing above its 100-day EMA resistance wave, thereby shifting the next upside target to the 200-day EMA near $2.
Conversely, the risk of an overall crypto market crash due to the US Federal Reserve’s tapering programs this year could derail ADA’s bullish setup to some extent. .
“While ADA is far from peaking, the prospect of more scalability as part of its 2022 roadmap explains why investors seem to be betting big on Cardano. This point was also noted by Liam Bussel, CMO of Cardano-based DEX WingRiders, in a statement to Cointelegraph.
Bussel said,
“In a world characterized by high performance and novel use cases, Cardano will be able to keep up and lead the pack. Therefore, there is a possibility of a weekly close above $1.80, barring any last-minute profiteering by sellers.”