The price of Cardano (ADA) continues to hold above its 200-day moving average (200DMA), a key support level that has consistently provided a springboard for rallies over the past six weeks. This raises an important question for traders: is now the ideal time to buy?
Recent history suggests that testing the 200DMA has been a lucrative short-term strategy for ADA traders. In early February, ADA rebounded from this level and surged 50% within ten days. A similar move occurred in late February, leading to an 80% rally in early March.
Market Conditions Have Shifted
However, while historical price action is encouraging, the current market landscape is significantly different. One major catalyst behind Cardano’s previous surge was the speculation that former U.S. President Donald Trump would include ADA in a strategic national crypto reserve. But as it turns out, ADA was never added, and there are no signs it will be included in the future.
Adding to this, Cardano founder Charles Hoskinson was notably absent from a key crypto event hosted by the Trump administration earlier this month, dampening hopes of regulatory favoritism.
Currently trading around $0.72, ADA is down roughly 40% from its recent highs. This decline coincides with broader weakness in the crypto market as macroeconomic conditions worsen. Despite a recent announcement by the Federal Reserve signaling an end to quantitative tightening, which is bullish for Bitcoin and crypto in general, concerns about inflation and economic growth persist.
BREAKING:
— Mister Crypto (@misterrcrypto) March 19, 2025
FED SAYS QT ENDS APRIL 1ST.
MONEY PRINTER IS COMING BACK.
MASSIVELY BULLISH FOR BITCOIN! pic.twitter.com/b4MHNfwc9l
How Low Could Cardano Go?
Should ADA fail to maintain its 200DMA, a deeper correction could be in store. A breakdown below this key level could signal the start of a prolonged downtrend, with potential support at February lows around $0.55 or even the mid-2024 highs near $0.40.
A Smart Buy or a Risky Bet?
Cardano’s long-term prospects remain promising, particularly as it positions itself as a leader in Bitcoin DeFi solutions. However, compared to rivals like Bitcoin, Ethereum, and Solana—each boasting significantly greater real-world adoption—ADA remains speculative.
Also Read: Cardano (ADA) Surges as Whales Accumulate and NASA Partnership Unfolds
Given Trump’s pro-crypto stance, the industry as a whole could see substantial growth over the next few years. While buying ADA at current levels might be a strong long-term bet, investors looking for lower-risk opportunities may find Bitcoin, Ethereum, and Solana to be safer alternatives with similar upside potential.
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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