Key Takeaways
- Cardano (ADA) is at risk of a crash if it fails to hold the key support level of $0.60.
- A 100 million ADA sell-off by whales and the overall bearish market sentiment are driving the price lower.
- Traders have built $26.19 million worth of short positions at the $0.666 level, showing strong confidence that ADA will not surpass this level anytime soon.
Today’s 5.25% drop has pushed Cardano (ADA) to a key support level, and the asset now looks at risk of a sharp crash if it fails to hold this level. The key catalyst strengthening ADA’s bearish outlook appears to be the massive whale sell-off, coupled with the overall downturn in the cryptocurrency market, where major assets, including Bitcoin (BTC) and Ethereum (ETH), have plummeted 3.35% and 2.05%, respectively.
Whales Sold 100 Million ADA and Its Impact on Price
Recently, a well-followed crypto analyst shared a post on X noting that Cardano whales holding between 100 million and 1 billion ADA tokens have sold 100 million tokens over the past 72 hours, which appears to be the key catalyst behind the recent market dip.
Today, amid the market sell-off, ADA’s price has reached a key support level of $0.605. Market participation has also dropped notably, as evident from the trading volume, which has declined by 24% to $1.45 billion.
Cardano (ADA) Technical Analysis and Upcoming Levels
With today’s decline, ADA appears to be losing key support at the $0.60 level. According to TimesCrypto’s technical analysis, ADA is in a downtrend as it trades below the 200-day Exponential Moving Average (EMA) on the daily chart. Moreover, the price also seems to be losing its crucial support zone.
Based on the current price action, if ADA fails to hold the $0.60 support level, it could see a sharp decline of nearly 15% and may reach the next support at $0.516. ADA’s bearish thesis would only be confirmed if the price closes a daily candle below the $0.60 level; otherwise, it would be invalidated.
On the other hand, if ADA holds and sustains above the $0.60 level, it could repeat its historical momentum, with a strong possibility of the asset rebounding once again.
As of now, ADA’s Chaikin Money Flow (CMF) currently stands at -0.06, indicating mild selling pressure and a lack of strong buying momentum in the market.
Traders Maintain Bearish Outlook
Besides price action and whale activity, data from the derivatives platform Coinglass reveals that intraday traders are also following the current trend, appearing to strongly favor short positions.
The data shows that ADA’s major liquidation levels stand at $0.599 on the lower side and $0.666 on the upper side, where strong participation has been recorded.
At these levels, traders have built $2.69 million worth of long positions and $26.19 million worth of short positions, indicating that bears are dominating the asset with a strong belief that ADA won’t surpass the $0.666 level anytime soon.
