The Data Says It Wasn’t Just Short Covering

ADA is among the top performers in the past week, surging by 10%.

The native token of the Cardano blockchain has skyrocketed by almost 100% since its multi-year low of under $0.14, marked in late June as the FUD around the protocol spread like wildfire.

The asset recently hit a multi-month peak of over $0.27, and data from Santiment showed that the move cannot be explained simply by short covering alone.

New Positions Are Entering

The crypto intelligence resource challenged the short-squeeze narrative after finding that ADA open interest actually increased about 25% over the same two-day period to over $300 million, during which the underlying asset jumped by 10% to over $0.27. The token marked its highest daily close since early April at that point.

This increase was not simply a consequence of the asset’s higher dollar price, as even measured in ADA, the OI climbed by roughly 13%. This suggests that traders were adding new leveraged positions as the move progressed. Santiment also outlined 314 whale transactions worth over $100,000 on October 5, around 2.2 times the weekday average during the previous month.

Nevertheless, short covering likely played some role, but not as significant as initially believed. Funding rates reached their most negative level of the past month on October 2 before shifting positive. However, Santiment stressed that covering shorts normally reduces open interest rather than increasing it.

Was $ADA’s rally really a short squeeze?

Some coverage said so, pointing to falling open interest. Santiment’s daily closes show the opposite.

📈 $ADA rose ~10% from Oct 3 to Oct 5.
📊 Open interest rose ~25% over the same two days, to $304M, its highest daily close since at least early April.
🧭 Measured in coins rather than dollars, open interest still rose ~13%, so this is new positioning, not just a higher price.
🐋 Whale transactions ($100K+) hit 413 on Oct 5, about 2.2x the Sep 7 to Oct 2 weekday average.

Social volume on Oct 5 sat at ~1.1x that same baseline.

Some short covering likely helped: funding hit its most negative reading of the past month on Oct 2, then flipped positive. But covering shrinks open interest, it doesn’t grow it.

The headline said squeeze, the open interest says leverage.

🔗 Explore ADA open interest in Sanbase: https://t.co/LOdcbV2HOB

— Santiment Intelligence (@SantimentData) October 6, 2026

Even Bigger Move Ahead?

Although ADA has outperformed most other larger-cap alts over the past week, Crypto Patel remains bullish on its longer-term picture. In a recent analysis, he noted that the token is roughly 98% above his previous accumulation zone and believes it could enter its next macro expansion phase.

You may also like:

His targets for the long term are quite optimistic at $0.50, $1.00, $2.00, $3.00, and even $5.00. He placed particular attention on the $2.00-$5.00 zone if the broader structure continues to develop.