The price of Cardano (ADA) is losing its key advantage in the market as it enters a consolidation phase, proving that it was indeed oversold.

Its price has fallen below the $1 mark, currently dropping to $0.9745, a slight decrease of 2.16%. Losing the $1 support area means a bleak outlook for the token as overheating and volatility trigger rare sentiments.

Is the Cardano sell-off a sign that the bubble has burst?

ADA's relative strength index (RSI) is at 67, reflecting a significant overbought sentiment. It remains to be seen how much further it can drop after breaking below $1.

On November 23, Cardano broke the $1 benchmark, ending a stalemate that had lasted for over three years below this level. Over the past month, the protocol has become one of the best-performing assets in the market.

As Bitcoin (BTC) dropped from above $99,000 to $95,000, market sentiment shifted, potentially returning to pre-speculation levels.

Over the past week, Cardano has still risen over 33%, with a monthly increase soaring to 204%. During this period, 68% of addresses on the network are in the 'In the Money' or profitable state. It is logical for these profitable traders to choose to sell.

Cardano Anchor Point

Amid ongoing price sell-offs, Cardano, like other altcoins, is focused on growth development. From the decentralized push of the Chang hard fork to the Hydra Doom testnet updates, the protocol is striving to become a benchmark in the industry.

Over time, Cardano has become a strong competitor to major rivals like Solana. While SOL has faced outages, Cardano recently celebrated years of uptime, which is a significant validation of its reliability. With a sudden turn towards a massive rebound shocking the market, Cardano's overall outlook remains positive. This could help it achieve a substantial rebound once the market stabilizes.

Open contracts and social indicators show strong momentum

Data shows that Cardano's open contracts have also increased significantly, growing by 33% to $1.08 billion. This growth indicates an increase in open contracts for ADA-linked futures, meaning traders are now preparing for further price volatility.

Meanwhile, $11 million in short liquidations over the last 24 hours affected those traders who were pushing the price up by betting on ADA's decline, forcing them to close their positions.

In the social realm, Cardano's mention rate has reached its highest point in 11 months, indicating growing interest in the token. This is well-known since social engagement tends to accelerate during bullish trends, similar to what was observed in previous uptrends.

Additionally, on November 13, ADA was relisted on Robinhood, significantly expanding the token's accessibility to retail investors, as the platform's 25 million users can now trade cryptocurrencies directly. This increased exposure has led to a surge in trading volume and price.

According to DefiLlama data, the decentralized finance (DeFi) ecosystem of this platform has achieved significant growth, with a total locked value (TVL) reaching a historic high of $609.97 million. This milestone indicates an increasing confidence among users in Cardano's technological infrastructure and decentralized applications.

Following the success of similar products from Bitcoin and Ethereum, speculation about a Cardano ETF has further fueled market enthusiasm, which could significantly impact ADA's price and adoption trajectory.

Moreover, what’s even more exciting is that Cardano has received an 'A-' rating from Weiss Crypto, placing it among the elite of leading cryptocurrencies. This recognition highlights the blockchain's resilience, technological innovation, and growing popularity.

Cardano Price Prediction: Will ADA Reach New Highs?

While Bitcoin has retraced, altcoins have not followed suit; however, ADA has still fallen below the $1 mark and has now reached a critical moment, with the $0.80 support level being a key point. This level has witnessed significant accumulation of 1.2 billion ADA tokens across 48,000 addresses, which could become a strong fortress against potential bearish pressure. If this support level holds, it could propel ADA upwards towards its $3 target.

Despite the bullish market sentiment for Cardano (ADA), its relative strength index (RSI) currently stands at 68.17, indicating that the asset is in the overbought zone. The RSI is a key technical indicator suggesting that ADA's price may have risen too quickly, potentially necessitating a correction or consolidation.