Cardano (ADA) appears to be at risk of further declines. Technical indicators and on-chain data suggest that ADA could drop by 15% to reach $0.70 if it fails to hold above the critical $0.90 support level.
ADA’s Technical Breakdown and Key Levels
According to technical analysts, ADA has confirmed its bearish trend after breaking below an ascending trendline. The altcoin is currently testing support at $0.90, but if a daily candle closes below this level, the price could tumble further to $0.70.
Despite the bearish momentum, ADA remains above the 200 Exponential Moving Average (EMA) on the daily chart. This suggests that the overall long-term trend is still bullish, but the immediate outlook remains uncertain.
Short-Sellers Gain Control
On-chain analytics from CoinGlass indicate that traders are betting heavily against ADA. Short positions currently dominate, with the $0.95 level acting as strong resistance. At this level, short-sellers are over-leveraged, holding $9.65 million in positions, while bulls are concentrated at $0.88, holding $6.30 million in long positions.
This data suggests that short-sellers have the upper hand, making it increasingly difficult for ADA to regain momentum. If bears continue to drive the market, ADA could struggle to break the $0.95 resistance and may see further declines in the near term.
Current Price Action and Market Sentiment
At the time of writing, ADA is trading at approximately $0.913, having dropped over 3.50% in the past 24 hours. This decline is accompanied by a 22% decrease in trading volume, indicating reduced investor participation. The overall negative sentiment in the cryptocurrency market further amplifies the downside risk for ADA.
Will ADA Drop to $0.70?
Given the current technical setup and market sentiment, a daily close below $0.90 could accelerate ADA’s decline toward $0.70. While the 200 EMA offers some long-term support, short-term traders remain cautious as short positions dominate market activity.
As the broader market struggles with bearish momentum, ADA’s price movement in the coming days will be crucial in determining whether it can hold support or face further downside pressure.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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