Cardano (ADA) price has surged past the $0.37 mark with a 4% gain because of a flurry of large acquisitions made by Whales on Monday. On the basis of on-chain data, there is a possibility of more bullish activity in the coming days. Do you think this recent surge indicates a bull trap, or do you think it will validate the $0.40 ADA price prediction?

This week, Cardano (ADA) emerged as one of the top-performing Layer-1 coins. Interestingly, Cardano whales were noticed making record numbers of transactions on Monday. With holders still in a net loss position, will the ADA accumulation frenzy continue?

Cardano Whales Spotted Buying the Dip

The number of unusual transactions for Cardano (ADA) saw a rise on Monday as the chart below indicates. On May 22, the number of large transactions involving ADA was 12,360, a 146% increase as compared to the recent low of 5,020 recorded on May 13.

Large Transactions measures the daily number of transactions that exceed $100,000. Previously, Cardano had attracted whale activity in May 2021. With heightened whale activity, investors might expect gains in the next few days.

Investors are Still Holding Losses

In spite of the price jump in ADA, according to Market Value to Realized Value (MVRV) data, most investors still hold significant losses for Cardano.

The Santiment chart below shows that investors who bought ADA in the last 30 days are holding nearly 6% losses despite prices being at $0.37.

Cardano investors usually do not sell until the price gets close to the breakeven point. As a result, we may see most Cardano investors consolidating their holdings for the next few days. However, when the ADA price approaches $0.40, things could change. Therefore, prospective investors may be careful to avoid the possibility of a bull trap.

ADA Price Prediction: All Eyes on $0.50

According to IntoTheBlock’s Break-Even Price Distribution data, Cardano is likely to reclaim the $0.50 milestone soon. However, breaking out above the $0.40 resistance zone could prove to be difficult for ADA. If 416,000 investors who hold 4.9 billion sell at $0.39 to break even, it could inadvertently trigger a pullback.

However, ADA could rally toward $0.50 if there is strong bullish momentum, as predicted. The bullish Cardano price prediction could be brief, though, if the ADA price dips below $0.36. In this scenario, the 151,000 investors who bought 2.5 billion ADA at the minimum price of $0.36 may offer some support. Failure to hold that key support level could result in a downswing toward $0.31