Cardano price pulled back slightly on Thursday morning as the recent momentum faded after the Senate withdrew the CLARITY Bill markup. ADA token was trading at $0.4050, down slightly from this week’s high of $0.4270. Still, there are several reasons why the ADA price will rebound this year.
Reasons Why Cardano Price May Rebound This Year
Cardano price has several catalysts that may boost its performance this year. First, the developers are continuing to work on the Leios upgrade that will be implemented this year. Leios is a major overhaul that aims to deliver scalability to the network by introducing parallel processing while maintaining security.
Charles Hoskinson and the team hope that this upgrade will bring in more developers to the network over time. This is important as the biggest developers in the crypto industry, like Aave and Uniswap, have largely ignored Cardano despite its popular brand name.
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In line with this, Cardano is implementing the Pentad proposals that seek to bring in more tier-1 stablecoins, oracles, and analytics tools to the network. The proposal is being funded by the 70 million ADA tokens that were removed from the treasury.
Still, Cardano’s challenge is that other networks like Ethereum and Solana are too far in terms of their development and adoption that it will struggle to catch up. The two have boosted their transaction speeds over the years, with the upcoming Alpenglow upgrade expected to boost Solana’s speed to over 100,000 transactions per second.
The other potential catalyst for the Cardano price is that it will launch the Midnight mainnet in this quarter after the successful launch of the NIGHT token in December. NIGHT’s market capitalization has jumped to over $1.2 billion, making it one of the biggest tokens launched recently.
There are chances that Grayscale will launch the spot ADA ETF it applied for later this year, which will likely lead to more demand from American investors.
Cardano Price Has Bullish Technicals
The daily timeframe chart shows that Cardano’s price has bullish technicals. It has moved above the Supertrend indicator and the 50-day Exponential Moving Average (EMA). In most cases, Cardano tends to jump by double digits whenever it moves to the green zone.
Cardano has also formed an inverse head-and-shoulders pattern, which is a common bullish reversal pattern in technical analysis. Therefore, the coin will likely rebound and hit the 38.2% Fibonacci Retracement level at $0.60, which is about 47% above the current level.
READ MORE: Crypto Market Rally Stalls as Senate Withdraws CLARITY Act Markup
