Cardano’s (ADA) price has been under pressure in recent days, plunging nearly 20% over the past three days. This has raised concerns among investors about the potential for a prolonged downtrend.
On-chain Data Insights
The recent selling pressure has been accompanied by high levels of liquidations for ADA. In the last 24 hours, liquidations totaling over $3.4 million were recorded, with Binance leading the way at $1.675 million. Notably, these liquidations were primarily long positions, indicating that traders were betting on the price of ADA to rise.
A technical analysis of the ADA price chart reveals several bearish signals. On the 4-hour timeframe, the price has broken below the 50 SMA and 50 EMA, indicating a strong downtrend. The price has bounced off the 58.68 cent level, but it may still test the 51.2 cent level, potentially forming an ABC corrective pattern.
Macro and Long-Term Outlook
On the daily timeframe, the price is also trending downwards, with a potential pullback into the b-wave target area between 58.92 and 52.82 cents. However, JB believes that the price could continue to fall, with a target of 68.47 to 74.97 cents in a c-wave move.
On the weekly timeframe, the price is forming an irregular flat correction. Despite the recent oversold stochastics on shorter timeframes, the weekly and monthly stochastics still appear overbought, suggesting that the broader trend is still downward.
Total Value Locked (TVL)
Despite the recent price volatility, Cardano’s native currency, ADA, has experienced significant growth in native tokens locked up. This indicates that there is still some level of investor interest in the project, even as the price declines.
JB expresses a cautious stance on ADA, expecting a significant market pullback. JB personally believes that the price of ADA could retest 22 cents, and that the broader market could also experience a correction. JB emphasizes the importance of viewer discretion and risk management in trading.
The short-term outlook for ADA is bearish, with a potential for further price declines. However, the long-term outlook for the project is more uncertain, and the price could rebound if there is a broader market recovery. Investors should exercise caution and do their own research before making any investment decisions.
Investment Caution Recommended
DISCLAIMER: This is not financial advice. Please do your own research before investing in any cryptocurrency.