Meanwhile, part of this cohort’s resilience may stem from ADA’s price still sitting 74.76% below its all-time high of $3.09, reached in September 2021.
The incentive to sell may not be compelling for many investors who bought during that cycle until the asset returns to those record levels. On the other hand, ADA short-term holders (STH) are exhibiting a surprisingly more cautious behavior in the current bullish market conditions.
Notably, this cohort quickly sold during 2021’s market rally but now applies far less selling pressure despite ADA’s 150% year-on-year gain.
Instead, Alphractal noted that they have modestly increased their positions in the digital asset.
Outside of these traders’ behaviour, on-chain indicators suggest ADA market conditions are hot and could give the asset another significant price run.
The adjusted Sharpe Ratio, a gauge of risk-adjusted returns, stands at roughly 1, reflecting the strong market performance compared to previous cycles.
Historically, ADA has seen sharp, parabolic rallies when this ratio approaches 2, making the current reading potentially supportive of further gains.
Aside from this indicator, a major bullish catalyst may be forming on the regulatory front.
If confirmed, an ETF could draw significant new demand from institutional and retail investors alike,e which could increase ADA’s value.
