- Cardano has surged 26% this week, driven by strong liquidity inflows and a rise in Total Value Locked.
- However, technical indicators suggest a potential bull trap, with resistance ahead and downside risk below key support levels.
Cardano (ADA) has captured investor attention with a sharp 26% surge over the past week, pushing its price to $0.75 at press time. A surge in liquidity has supported this upswing — with Open Interest in derivatives jumping over 3% to reach $1.21 billion and over $14 million in ADA flowing into spot markets. This marks the third time in 2025 that Open Interest has crossed the $1.2 billion mark, a notable threshold that often precedes major moves.
On-chain data also reinforces optimism. Cardano’s Total Value Locked (TVL) has edged up to $333 million, reflecting renewed user confidence in its ecosystem. However, these increases remain relatively modest, hinting that bullish enthusiasm may not be as solid as it appears on the surface.
Could This Be a Bull Trap?
While the rally feels encouraging, technical analysis tells a more cautious story. The 24-hour liquidation heatmap shows limited liquidity above the current price, with resistance forming around the $0.78 to $0.84 range. A stronger ceiling exists at $0.844, a bearish trendline that could block further gains.
Below current levels, significant clusters of unfilled orders suggest ADA could drop toward $0.68 if the price fails to hold support at $0.74. This imbalance points to a potential bull trap — a scenario where buyers are lured into a rally only for the price to reverse sharply, triggering liquidations.
A Strategic Cardano Buy Zone May Be Forming
Despite these risks, the broader altcoin market (TOTAL3) shows a developing bullish trend. If ADA retraces to the $0.73 area and bounces back, analysts see a path toward $1.2 — a potential 60% upside. For those looking to capitalize, this pullback may offer a better entry point than chasing the current high.
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