In recent days, the price of Cardano (ADA) has been on a downward trend, reinforcing bearish sentiment in the market. In the last 24 hours, ADA’s price dipped about 4.2%, and over the past week, the altcoin’s value depreciated by almost 10%. This price fluctuation has raised questions regarding the level of interest that investors have in Cardano. The low buying strength and accumulation observed on the charts are a reflection of this. With Cardano now trapped within a range and lacking a clear price direction, buyer confidence is gradually eroding.
The bears have gained strength, causing an important support level to be breached and subsequently transforming into a resistance level for the altcoin. For Cardano to regain its previous price ceiling, buyers must re-enter the market. However, broader market conditions, including Bitcoin’s consolidation around the $27,000 zone, have prevented many major altcoins, including Cardano, from surpassing their immediate resistance levels. For ADA to overcome its nearest resistance, it relies heavily on the market’s overall strength. The decline in market capitalization further emphasizes the increase in selling strength.
**Cardano Price Analysis: One-Day Chart**
At the time of writing, the price of ADA stood at $0.35, approaching a significant local support level that has played a critical role in the past. The closest support line is $0.34, while the overhead price ceiling is $0.36. The altcoin’s ability to reclaim the resistance level mostly depends on the bulls’ ability to defend the price above the immediate support level.
If the current level experiences a decline, the coin is likely to first drop to $0.34, and if the selling pressure persists, it may decline further to $0.33. It’s worth noting that the volume of Cardano traded during the last session has decreased, indicating a decline in buying strength.
**Technical Analysis**
Since ADA’s price dropped below the $0.38 level, its buying strength has failed to rebound. The Relative Strength Index (RSI) is below the 40-mark, revealing that ADA is nearing oversold territory on the daily chart. Furthermore, the asset’s price has dropped below the 20-Simple Moving Average (SMA) line, suggesting that sellers have taken control of the market’s price momentum.
ADA has generated sell signals based on various indicators, indicating a possible decline in its price. The Moving Average Convergence Divergence (MACD) indicator, which reveals price momentum and reversals, displayed red histograms associated with sell signals for the altcoin. Additionally, the Directional Movement Index (DMI), which indicates price direction, showed a negative trend, with the -DI line (orange) positioned above the +DI line (blue). This implies a bearish sentiment in the market.
The Average Directional Index (ADX), which measures the strength of a price trend, attempted to move above the 20-mark but failed, indicating a lack of strength in the current price trend.
**Conclusion**
In conclusion, the downward trend in Cardano’s price has raised concerns about the overall interest of investors in the altcoin. With a low buying strength and accumulation, the bearish sentiment in the market is becoming stronger. The bears have breached an important support level, which has now turned into a resistance level that Cardano needs to overcome.
For ADA to surpass its immediate resistance, it will need to rely on the market’s overall strength. However, the decline in market capitalization shows an increase in selling strength. If the bulls fail to defend the price above the immediate support level, Cardano’s price will most likely decline further. Technical analysis supports this view, with indicators such as the RSI, MACD, and DMI all suggesting bearish sentiment in the market.
Investors should monitor market conditions closely and consider their positions accordingly. The future direction of Cardano’s price will largely depend on the ability of buyers to re-enter the market and the strength of the broader cryptocurrency market.
