Cardano (ADA) is facing increasing bearish pressure as key market indicators suggest the altcoin could be heading for further decline if current trends continue. According to data from IntoTheBlock, the netflow of large ADA holders has dropped by a staggering 90% over the past week. These large holders, or “whales,” control over 0.1% of the coin’s circulating supply, and their reduced activity signals a lack of confidence in the asset. When whale netflows decrease, it often results in lower liquidity, which can cause heightened price volatility and further downside pressure.

The decline in whale activity has been accompanied by rising demand for short positions in ADA’s futures market. With the coin’s negative funding rate of -0.005%, traders are increasingly betting against the altcoin, signaling a bearish sentiment in the broader market. A negative funding rate indicates that short traders are paying long traders, reinforcing the notion that ADA’s price is expected to fall further.

Adding to the bearish outlook is ADA’s performance on technical indicators. The altcoin continues to trade below the red line of the Super Trend indicator on the daily chart, a key momentum indicator used by traders to identify market trends. When an asset’s price is below the red line, it typically signals a dominant selling pressure, and ADA has yet to show signs of reversing this trend. If the selling pressure persists, ADA’s price could continue its descent toward $0.70.

However, should buyers begin to return and accumulate the coin once again, there is potential for a modest recovery. In this scenario, ADA could see a bounce back to $0.82. For now, the prevailing market sentiment suggests that ADA remains at risk of further declines as both whale activity wanes and futures traders continue to bet against the altcoin.
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.