At press time, the price of Cardano (ADA) has fallen by 46%. As such, ADA holders are losing faith in the token’s long-term potential as it approaches the critical $0.30 mark.

Growing concerns over Cardano’s falling price and stagnant momentum have fueled this sentiment. As bearish pressure mounts, this analysis checks whether more losses are on the horizon or if the altcoin will see a recovery.

Confidence in HODLing Cardano Declines

At the time of writing, Cardano’s price is $0.33, despite having reached $0.41 on September 27. As per BeInCrypto’s findings, this drop is associated with the notable reduction in the token’s Coins Holding Time.

Coins Holding Time measures the amount of time a cryptocurrency has been held without being sold. When it increases, it means that holders are confident about the gains that the cryptocurrency in question can produce.

On the other hand, a decrease in the metric implies that holders are liquidating the asset, indicating that they are no longer confident in its short-term potential. Based on data from IntoTheBlock, ADA’s Coins Holding Time has dropped by almost 50% in the past seven days, suggesting that many holders are selling the token.

Cardano Holders Sell Cardano Coins Holding Time. Source: IntoTheBlock

Another on-chain metric fueling this speculation is the Mean Coin Age (MCA), which is the weighted age of each token on a blockchain. A low coin age suggests that investors have accumulated new tokens and retired them to a cold wallet, which is usually a bullish sign.

Spikes in the metric, however, imply that holders are moving old tokens out of their wallets. In most cases, this means that these holders are planning to sell, as they are with Cardano.

If the MCA continues to rise, the price of ADA may not recover but instead continue to decline.

Cardano’s Ancient Coins Enter Circulation Average Age of Cardano Coin. Source: Santiment

ADA Price Prediction

A look at the daily chart shows that ADA has formed a head and shoulders pattern. This pattern is a bullish-to-bearish chart reversal that indicates an accelerating downtrend. This technical pattern has three peaks: the left shoulder, the head, and the right shoulder.

The baseline of the head and shoulders pattern is at $0.34. Cardano price has fallen below this point, reinforcing the weakness in its trend. The Relative Strength Index (RSI) also supports the bias as it has fallen below the neutral line.

Cardano daily price analysis. Source: TradingView

This decline implies bearish momentum. If this trend continues, Cardano price could fall below $0.33 and head towards $0.30.

On the other hand, the token still has a chance to recover if holders stop selling. In this scenario, ADA could jump to $0.38.

The article Cardano Holders Cast No Confidence Vote, Price Targets $0.30 appeared first on BeInCrypto.