Cardano (ADA) has recently seen significant value loss, dropping 15% in price in just one week, causing significant bear market pressure.$ADA
New data shows a decrease in activity by large investors (whales), with large-volume investors reducing their positions, creating short-term selling pressure on ADA.
If ADA loses the critical support level at $0.95, it could face a 46% correction risk to $0.519. However, breaking the resistance level at $1.03 could trigger a price recovery and rally again.
The Average Directional Index (ADX) for Cardano is currently at 19.96, a significant increase from 11 the day before. This rise in the ADX suggests that the downtrend is gaining strength and ADA’s efforts to maintain its bullish trend are weakening. This suggests that the bearish momentum could intensify further. If buying interest remains weak, selling pressure could increase.
ADX is an important indicator that measures the trend strength of financial markets, with values above 25 indicating a strong trend and values below 20 indicating a weak market. ADA approaching this threshold indicates increased volatility in the current bear market and should be monitored carefully by investors.
The latest data shows that the number of addresses holding 10 million to 100 million ADA has decreased from 409 to 407 in just 5 days. This decrease indicates a significant shift in market dynamics as large investors (whales) are reducing their positions. This trend suggests that investors holding significant amounts of ADA are shedding their assets, which could be linked to either declining confidence or a strategy to profit from a bear market.
Tracking whale transactions is critical as they can significantly impact market trends and price movements. The increase in the number of whale accounts from 400 to 409 between December 10-14 indicates a period of accumulation, while the recent decline indicates a reversal. If a new wave of buying does not begin, selling pressure on ADA may increase.
Technical indicators suggest that the probability of a deeper correction for ADA is increasing. Currently, the short-term Exponential Moving Averages (EMA) are trending downwards, and a drop below the longer-term EMA could be interpreted as a signal commonly known as a “death cross”. This is considered an indication of a continued bearish move.
If the ADA price breaks below the $0.95 level, it could drop to lower levels such as $0.65 or $0.519, which would imply a 46% drop. However, if buying pressure increases significantly, Cardano could attempt to break above the $1.03 level. A break of this level would open up more upside potential for ADA, with targets at $1.18 and perhaps $1.24.