Cardano’s native token, ADA, is currently experiencing a challenging phase, with expectations of further price declines over the next few days. This trend is largely driven by persistent market uncertainty, the emergence of bearish price patterns, and widespread negative sentiment within the cryptocurrency domain. As of December 31, 2024, major cryptocurrencies, including Bitcoin (BTC), Ethereum (ETH), and Solana (SOL), are also facing difficulties in maintaining upward momentum.
Cardano (ADA) Technical Analysis and Upcoming Levels
Expert technical analysis indicates a short-term bearish outlook for ADA. The token has displayed a descending triangle price pattern on the daily chart, suggesting a potential breakdown on the horizon. This pattern follows the breakdown of a bearish head-and-shoulders configuration.
According to historical price trends, if ADA breaks below the descending triangle’s support and closes a daily candle beneath the $0.825 threshold, there is a substantial chance it could decline by an additional 10%, potentially reaching the critical support level at $0.75. However, this bearish scenario is contingent on ADA closing below the $0.825 mark; failure to do so could invalidate the bearish outlook.
$38 Million ADA Outflow
Despite the bearish sentiment, long-term holders have demonstrated significant interest and confidence in ADA. On-chain analytics firm Coinglass reports substantial ADA outflows, with exchanges witnessing a withdrawal of approximately $37.92 million worth of ADA. This outflow metric signifies the volume of assets transferred from exchanges to wallet addresses, often indicating potential upward momentum, increased buying pressure, and favorable buying opportunities.
Furthermore, while long-term holders remain engaged, traders are exhibiting caution as ADA approaches a critical juncture, preparing for a potential breakdown. This cautious stance has resulted in the liquidation of several million dollars in long positions, as evidenced by a 3.9% decline in ADA’s open interest over the past 24 hours.
Current Price Momentum
At present, ADA is trading at approximately $0.8456, having experienced a 3.15% price decline in the last 24 hours. During this period, trading volume surged by 15%, indicating increased activity from traders and investors compared to the previous day. This heightened participation underscores the dynamic nature of ADA’s market environment.
In conclusion, while ADA faces bearish pressures, the commitment from long-term holders and the dynamic trading environment suggest that the market remains active and unpredictable. Investors should stay informed and consider market trends when evaluating their positions in ADA and other cryptocurrencies.
