Cardano (ADA) saw a significant rally in March, reaching a one-year high of $0.4622. Excitement spread among ADA investors as the price rose, but unfortunately, it was short-lived. The price faced rejection at this level, which caused ADA to drop to the $0.3760 support.
However, despite this setback, ADA managed to find some stability as the bulls defended this crucial support level. Throughout the month of May, it was ADA price volatility Above and below the support level, which gives investors hope.
However, the tide turned in June when intense selling pressure engulfed the market. ADA, like many other digital currencies, has found itself caught up in the wake of regulatory issues related to it The security label is assumed. Market sentiment has turned bearish, and altcoins have suffered significant losses as a result.
ADA is not a security: Gensler once again gets himself ahead # Cardano # Cardanovid #ADA # encrypt #cardanocommunity # Bitcoin #CoinMarketCap # Blockchain #cryptocurrency # Cardano #btc ADA dollarshttps://t.co/cwM1SD0Brm
– Cardano Feed ($ADA) (@CardanoFeed) June 14, 2023
Now, the question arises: What awaits ADA as the downtrend continues to unfold?
The relationship between Bitcoin price and the performance of altcoins
At the time of writing this report, Bitcoin (BTC) is trading below the $25,000 level, to exert its influence on the broader cryptocurrency market. The BTC price drop had a profound effect on altcoins, causing a ripple effect throughout the cryptocurrency ecosystem.
Source: Coingecko
Altcoins, including Cardano’s ADA, have been hit hard by the bitcoin downturn. ADA, priced at $0.259126 at the moment Queen Gekko, it has seen a 7.3% drop in the past 24 hours alone, contributing to a significant seven-day drop of 22%. These numbers illustrate the strong correlation between Bitcoin price movements and the performance of altcoins.
Bitcoin, being the largest and most established cryptocurrency, is often the leader for the entire crypto market. When Bitcoin experiences a price drop, it tends to instigate a domino effect, leading to widespread selling across various digital assets.
This association stems from the fact that many altcoin traders and investors use Bitcoin as a standard or base currency for trading.
ADA market cap slightly below $9 billion. Chart: TradingView.com
Moreover, bitcoin price movements often reflect the general market sentiment and investor confidence in the cryptocurrency industry. When Bitcoin faces major challenges or negative news, it creates a sense of uncertainty and fear among market participants. As a result, investors may seek to reduce their exposure to riskier assets such as altcoins, causing their prices to drop.
Interest in Cardano’s bull run waned
According to the data provided by Coinalyze in a four-hour timeframe, it was observed that the The open interest (OI) of ADA was decreasing. Diminishing open interest indicates that market speculators are showing a lack of enthusiasm for ADA’s potential bull run.
ADA Open Interest down. Source: Coinalyze
Similarly, the Spot CVD (Cumulative Delta Volume) has been consistently in a downtrend, highlighting the prevailing downtrend in the market. This further confirms the dominance of bear market forces, which indicates a negative outlook for ADA.
Featured image from CoinChapter
