Cardano Passes Crucial Update As ADA Price Prepares For 65% Rally

The Cardano ecosystem is ringing in significant transformations with the Cardano Foundation’s announcement of a pivotal modification to its staking parameters. After a stake pool operator (SPO) poll and thorough deliberations by the Parameters Committee, the foundation decided to update the network to enhance both its competitiveness and user experience.

The Cardando Foundation stated via X (formerly Twitter): “As a result of the Stake Pool Operator [SPO]-Poll and a subsequent evaluation by the Parameters Committee, the Cardano Foundation has successfully submitted a transaction on the Cardano mainnet to lower the minPoolCost parameter from 340 to 170 ADA.”

This development has been welcomed with a mix of anticipation and strategy from different sections of the Cardano community. Cardano staking pool “Stake with Pride” was quick to pivot in line with the new parameters, remarking:

The Cardano min Pool Cost fee has been dropped to 170 ADA from 340. SPOs can drop their fees starting epoch 445 on October 27th. They further pledged to optimize their policies with the recent modifications, firmly anchoring their “minPoolCost to 170 permanently, and Margin to 0% temporarily, as market dynamics are assessed.

The minPoolCost parameter, as explained in a Cardano Foundation blog post from September 13, had twofold objectives since its inception with the Shelley launch in 2020. The primary two goals were to act as a defense against Sybil attacks and to guarantee pool operators a floor income to sustain their server operations.

The Cardano Foundation elaborated, “By potentially halving minPoolCost we don’t enforce but allow the operators to reduce their ‘floor’ income.” The strategic change is anticipated to shift market dynamics favorably for smaller pool operators, providing them with a more level playing field.

Cardano (ADA) Price Poised For A 65% Rally?

The Cardano price has seen a strong uptrend in the past few hours, in line with the overall crypto market. At the time of writing, ADA was trading at $0.282, up 6.5% over the past 24 hours. The 1-day chart of ADA shows that ADA was able to break out of its 6-month downtrend (black line) this past Sunday. On April 15, ADA marked its high for the year at over $0.46, since then the Cardano price has been on the decline.

As a result of the breakout momentum, ADA was able to overcome the important 0.236 Fibonacci retracement level at $0.277. Remarkably, the price has already withstood a retest and established it as new support on the lower time frames. Should ADA manage a daily close above this price level today, the outlook for the Cardano price could turn further bullish.

As then, ADA would have to face arguably the most important resistance at the moment, the 200-day exponential moving average (EMA, blue line), at $0.299. The price indicator is often referred to as the “bull line”. Accordingly, a breach could maneuver ADA back into bullish territory. ADA last failed to complete a daily close above the 200-day EMA in mid-July.

If a breakout into bullish territory succeeds, the next targets would be the Fibonacci retracement level of 0.382 at $0.313, 0.5 at $0.341, 0.618 at $0.370, and 0.786 at $0.411. The pinnacle target remains the annual peak of $0.463, suggesting a prospective ascent of 65% from its present value.

In this context, it is important to mention that ADA has underperformed compared to other altcoins so far this year. For example: While Solana (SOL) is currently trading just below its high for the year and Ether (ETH) is only 15% away from a new high for the year, ADA is still 39% below this level.

On the one hand, this shows the existing potential, and on the other hand, it shows that ADA has not been one of traders’ favorite altcoins so far in 2023. Whether a rise above the 200-day EMA can change this remains to be seen.

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By: Jake Simmons
Title: Cardano Passes Crucial Update As ADA Price Prepares For 65% Rally
Sourced From: www.newsbtc.com/news/cardano/cardano-crucial-update-ada-price-65-rally/
Published Date: Tue, 24 Oct 2023 12:00:06 +0000

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