Cardano (ADA) Price Drop: The Double Effect of Whale Activity and Market Sentiment
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Cardano (ADA) has recently experienced a price correction, dropping from $1.33 to $0.91, primarily influenced by a wave of whale sell-offs. This market behavior reflects both profit-taking by large holders and reveals the complex changes in market sentiment.
Whale Sell-Off Wave and Its Impact
1. Scale of Sell-Off and Sources of Pressure
Whale Sell-Off Activity: Santiment data shows that whales holding between 100 million to 1 billion ADA sold approximately $200 million worth of tokens in the past week.
Market Signal: This large-scale sell-off exerted significant pressure on the price momentum of ADA and triggered a chain reaction among retail investors, exacerbating market volatility.
2. The Role of Profit-Taking
On-chain Realized Profit/Loss Data: On-chain analysis indicates that profit-taking for ADA has continued over the past week, becoming a key force driving the price downward.
Short-Term Speculative Behavior: Positive profit indicators incentivized some investors to cash out at price peaks, further accelerating the downward trend.
Key Shifts in Whale Behavior
Despite the price drop, on-chain data indicates notable changes in whale activity:
Reaccumulation After Profit Lock-In: After the price fell to $0.91, whales reaccumulated 160 million ADA at lower levels, indicating confidence in the bullish outlook.
Surge in Whale Transactions: Single transactions exceeding $1 million surged to 700 within a day, showing high market activity.
Significant Growth of Medium-Sized Wallets
New Holdings: Medium-sized wallets holding between $1 million to $10 million in ADA grew by 67% over the past month, indicating increased attractiveness of the current price for this group.
Market Sentiment Divergence: Despite whale reaccumulation and the increase of medium-sized wallets, the market is still caught between bullish and bearish forces, with overall sentiment leaning towards caution.
Buying the Dip: Whale reaccumulation and the growth of medium-sized wallets suggest that some investors view the current price as a buying opportunity.
Ecosystem Development: Cardano's technical updates and ecosystem expansion may provide long-term support for ADA.
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