This article is also available in Spanish.
Cardano (ADA) has had a tough stretch, seeing a sharp 42% correction since hitting a multi-year high of $1.32 in early December. This significant decline reflects broader market uncertainty, with increased selling pressure and cautious investor sentiment weighing heavily on the price of ADA. Despite this, on-chain data indicates a shift in dynamics, indicating a potential recovery for the beleaguered cryptocurrency.
Related reading
Senior analyst Ali Martinez highlighted key metrics indicating a buildup of whales in recent weeks, adding a layer of optimism to ADA’s forecast. According to Martinez, the most important support zone for Cardano is between $0.77 and $0.68, a range that the market has consistently respected. This support has proven important in stabilizing the price of ADA, providing a base from which a recovery can be achieved.
Continued interest from senior bondholders indicates confidence in ADA’s long-term potential, even amid short-term volatility. As Cardano continues to defend critical support levels, market participants are watching closely for signs of a breakout. As whale activity increases and technical indicators align, Cardano’s next moves could redefine its course, providing a glimmer of hope in a challenging environment.
Cardano paves the way for the move
Cardano faced a sharp pullback after its explosive rally in November, entering a phase of a deep correction that shook investor confidence. Despite the recent pullback, ADA appears to be finding stability as it consolidates above critical support levels, sparking renewed optimism about a potential rebound.
Noted analyst Ali Martinez recently Share technical analysis on XTo identify the most important support area for Cardano between $0.77 and $0.68. According to Martinez, price action at ADA has closely respected this range, reinforcing its importance in preventing further declines. If ADA continues to hold above this level for a few more days, the foundation could be laid for a strong rebound, which could reverse the downtrend.
What increases the positive expectations is the behavior of major market participants. On-chain data reveals significant whale activity during this consolidation phase, suggesting that large investors are taking advantage of lower prices to accumulate ADA. This pattern of accumulation often indicates growing confidence in a project’s long-term potential, even in the face of short-term price fluctuations.
Related reading
With ADA holding above the crucial support zone, market participants are eagerly awaiting the breakout. If a sustained recovery occurs, this could put Cardano on a strong uptrend, reclaiming recent losses and possibly testing new highs.
Price Action: The main display for testing
Cardano is currently trading at $0.87, experiencing increasing selling pressure that has kept its price low. Despite the challenges, ADA showed resilience by holding above key support levels, indicating that buyers are still active in the market. But the next few days will be crucial to determine its direction.
An important price milestone lies at the $1 mark, which has served as a psychological resistance level in recent weeks. If ADA can successfully reclaim $1 with strong momentum volume, it could pave the way for a massive rally. Such a breakout would likely see ADA target a yearly high of $1.32, a level last reached during its impressive November rally. Clearing this resistance would signal renewed bullish sentiment and perhaps attract more buying interest.
Related reading
On the downside, the risk of a deeper bounce remains if selling pressures intensify. ADA could test lower demand areas around $0.75, which is in line with historical support levels. This scenario is likely to lead to a period of additional consolidation as the market seeks equilibrium. Right now, the Americans with Disabilities Act remains at a crossroads, with opportunities for recovery and risks of further downside.
Featured image by Dall-E, chart from TradingView