Cardano (ADA), Ripple (XRP) led by short traders amid subsequent bounces

With investors eagerly awaiting a much-needed rally in crypto market price action, Cardano (ADA) and Ripple’s XRP have emerged as two of the most prominent altcoins experiencing a strong short period of trading after a short rest

This activity occurs amid slight signs of a pick-up in their prices.

Strong short on ADA and XRP

According to data shared by Santiment, find rates for both ADA and XRP on Binance have surged into positive territory several times, indicating a dominant short and long ratio since September 2023 for the first and May of 2024 for the second.

The recent gains may have led traders to believe that a downtrend is likely, causing many to rush the two altcoins.

However, Santiment believes that this short-lived intense activity could be a positive sign for the “patient bulls”.

📈 Cardano and XRP are a couple of the most notable altcoins that are being shorted by traders after relief bounces. This is a good sign for patient bulls, as liquidation shorts can effectively act as “rocket fuel” for continued price increases. pic.twitter.com/lHdMCLbngR

— Santiment (@santimentfeed) June 19, 2024

Earlier this week, the on-chain analytics platform found Cardano to be extremely undervalued with an MVRV of -12.6%, while XRP’s stood at -3.5%. For ADA, this analysis indicated a very bullish outlook for its price recovery. Meanwhile, for the latter, the MVRV ratio suggested mild bullish conditions.

The low MVRV ratio suggests that traders are currently holding assets at prices below their initial purchase costs. Historically, this oversold scenario has been followed by a rally as the asset attracts buying interest.

Catalysts for ADA and XRP

Cardano, for example, appears to be gearing up for a major milestone that could serve as a catalyst for its token. Chang’s hard fork is expected to pave the way for the Voltaire era by transitioning Cardano from a blockchain governed by its founding entity Input Output Global (IOG) to a fully decentralized ecosystem powered by the community

Announcing the same, IOG founder Charles Hoskinson recently tweeted:

“It looks like June will be the month when Cardano Node will reach 9.0. This means that Cardano is ready for the Chang fork and expects 70 percent of SPOs to install the new node. Then a hard fork may occur which pushes Cardano into the age of Voltaire.

Meanwhile, XRP has seen minor spikes amid a broader market decline. The latest increase in open interest (OI) further suggested that investors are increasingly opening positions in anticipation of a rise in the asset’s price as they closely follow the legal dispute between the blockchain company Ripple and the US Securities and Exchange Commission (SEC).

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