Latest, hurry to see that Cardano (ADA) may drop 15%, here are the reasons

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Today, on December 22, 2024, the entire cryptocurrency market is struggling, and Cardano (ADA) is expected to see a significant price drop after forming a bearish price action pattern. According to data from on-chain analysis company Coinglass, traders and investors seem reluctant to participate in altcoins amid this mild bearish market sentiment.

Analyzing recent on-chain indicators and technical analysis suggests a positive outlook for Cardano (ADA). Although long-term holders show optimism, evidenced by a significant outflow of funds from exchanges, technical patterns indicate a potential bearish trend in the short term.

Technical analysis and upcoming levels for Cardano (ADA)

According to CoinPedia's technical analysis, ADA is showing a bearish trend as it has successfully broken the head and shoulders price pattern and recently retested that level. This retest of the breakout level partially confirms that ADA's price is set to decline soon.

Based on technical analysis, it's highly likely that the altcoin will drop 15% to the next support level of $0.80. If this sentiment persists, ADA will easily achieve the predicted target.

Optimistic on-chain indicators

According to Coinglass, despite the bearish technical analysis, long-term holders seem optimistic about ADA. Based on ADA's spot inflow/outflow data, exchanges witnessed a massive outflow of ADA worth $200 million over the past week. However, despite the significant price drop, there was not a single inflow during this period.

This trend indicates that the assets of long-term holders are flowing out of exchanges. This suggests that investors are bullish and accumulating tokens during the price crash, indicating potential upward momentum and ideal buying opportunities.

Current price momentum

As of the time of writing, ADA is trading at nearly $0.89, having dropped over 5.5% in the past 24 hours. During the same period, its trading volume decreased by 45%, indicating a decline in the participation of traders and investors as prices continue to fall.

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