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- ADA surged 7%, but concerns about a deeper correction linger due to recent trends.
- Increased whale activity and high trading volume show potential support for ADA’s price.
- ADA faces a critical test; a false rally could lead to further decline.
Cardano’s ADA left many investors hopeful after an impressive 7% jump. But as with any sharp move in the market, it raises a lot of questions. Can this rally hold up, or is it just a quick blip before another downturn? ADA holders are in for an interesting ride after volatile price movements. So, what’s next for ADA?
Analyzing ADA’s Momentum
Cardano’s recent performance has fueled market optimism. Even after a sharp 12.60% drop in the past month, ADA is still 87% above its price on election day. That’s a big deal, especially compared to other major assets. This suggests that a lot of holders believe in Cardano’s future and have chosen to ride out any downturns, hanging onto their gains instead of selling off. Cardano’s issues aren’t just a recent hiccup.
Since February, ADA has been trending downward, posting three consecutive lower lows. Every time, key support levels were broken, which suggests there’s some structural weakness beneath the surface. When ADA dropped below $0.58 on April 6th, concerns about a deeper correction quickly resurfaced. This level had been holding strong for months, so its loss was a big red flag.
Will ADA’s Price Continue Dropping?
Cardano’s MVRV ratio has also gone negative. This means that, on average, recent buyers of ADA are now underwater. If the price doesn’t recover soon, many might decide to sell, adding more downward pressure. However, there’s still hope. Trading volume saw a massive jump on April 7th, soaring to $1.98 billion, up from just $941 million the day before.
Whales are also stepping in, with a large cohort (holding between 100 million and 1 billion ADA) buying up another 250 million ADA on April 10th. This shows that big players are still interested, which could help keep the price afloat for now. That said, there’s reason to be cautious. The biggest whale group, which holds 12.6 billion ADA, hasn’t made any big moves recently.
What’s more, a spike in dormant whale circulation suggests that previously inactive coins are now moving. Historically, this is a sign that the market might be nearing its peak. If ADA can’t hold its ground above $0.58, things could get ugly. The coin’s underlying weakness, combined with weak fundamentals, makes a sell-off more likely.
For now, ADA faces a critical test. If the recent rebound turns out to be a false rally, we could see a deeper decline. Only time will tell if Cardano can break out of this slump or if the market will continue to drag the coin lower.
