Cardano Recovery at Risk, Traders Saved From $20 Million Loss

Airdrop Is Live 🔥 CaryptosHeadlines Media Has Launched Its Native Token CHT. Airdrop Is Live For Everyone, Claim Instant 5000 CHT Tokens Worth Of $50 USDT. Join the Airdrop at the official website, CryptosHeadlinesToken.com


Cardano (ADA) has been experiencing a period of fluctuating price action. Despite efforts to recover, ADA has faced challenges in maintaining its upward momentum. 

While the altcoin has held onto an uptrend since the beginning of the month, it now faces a challenge. Traders may be pulled back from participating, potentially stalling any further price recovery.

Cardano Traders Are In Trouble

The sentiment around Cardano (ADA) is mixed. According to the Liquidation Map, short traders are at a disadvantage if ADA continues its uptrend. A breach of $0.77 would lead to the liquidation of approximately $20 million worth of short contracts.

This could result in upward pressure on the price as shorts are forced to close their positions. 

However, without strong bullish momentum, this upside potential may not materialize, keeping traders cautious. While short traders could face substantial losses if ADA rises, this risk does not necessarily mean that the uptrend is sustainable.

Cardano Liquidation Map.
Cardano Liquidation Map. Source: Coinglass

Overall, Cardano’s market momentum reflects a sense of uncertainty. The number of active addresses on the network has recently dropped to a four-month low of 20,700. This decline in investor participation indicates a lack of enthusiasm among ADA holders. Many investors are seemingly pulling back, waiting for clearer signals of recovery before re-engaging with the token. 

This lack of participation has had a negative impact on Cardano’s liquidity and transaction volume, further influencing its price dynamics. The decreasing number of active addresses also suggests that traders are hesitant to invest in ADA, which could slow down any potential price recovery.

Cardano Active Addresses
Cardano Active Addresses. Source: Santiment

ADA Price Faces Barrier

Cardano is currently trading at $0.70, holding above the support level of $0.70, and the uptrend line has supported the price since early March. The immediate target for ADA is to breach the $0.77 resistance level, but this remains a challenge. Achieving this would require a rise of approximately 9%, which may be difficult under the current market conditions.

In the absence of a broader market rally, ADA is likely to remain consolidated under the $0.77 resistance. Should the altcoin fail to hold the $0.70 support, it could experience a decline, potentially falling to $0.62. This would invalidate the recent bullish outlook, further dampening investor confidence.

Cardano Price Analysis.
Cardano Price Analysis. Source: TradingView

If ADA successfully breaches the $0.77 resistance, it could rise to $0.85, thereby invalidating the bearish thesis. Such a move would likely signal a more sustained recovery, as it would clear a significant hurdle for Cardano.

Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.



Source link