Cardano (ADA) has been under pressure lately and has dropped nearly 12-15%, slipping below the $0.6 level for the first time in nearly two months. It’s currently hovering around the $0.59 to $0.60 mark, which is a critical support zone for the altcoin. While the broader crypto market isn’t in panic mode, the ADA price seems to be losing steam.
What’s Dragging the Cardano (ADA) Price Down?
One of the main reasons behind the decline is the bearish technical momentum building up on the charts. Technical indicators are also signalling downward pressure, which is expected to be strong and may continue unless the buyers step in. ADA is also forming a possible falling wedge pattern, which is typically a bullish reversal sign, but it is not confirmed yet. Therefore, if the price breaks below the current support, the next stop could be around $0.57 or even $0.5.
The above chart shows the price being stuck within a descending parallel channel while holding a crucial support zone. Currently, the price has reached the same support zone between $0.6 and $0.61, but is showing fewer signs of a positive rebound. If the price fails to trigger a rebound, a drop to the next support at $0.51 is viable. However, a rebound may elevate the levels to $0.65, which appears unlikely as the RSI is about to reach the lower threshold. A drop within the oversold range could validate a bearish continuation.
Long-Term Holders are Taking Profit
On-chain data reveals another red flag: ‘Age Consumed’—a metric that tracks the movement of older coins that have not been transacted for a significant period, just hit a 9-month high. This spike signals the diminishing confidence among the investors, as a rise in the metric suggests the long-term holders are cashing out and hence a negative impact on the ADA price could be imperative.
This behaviour of the long-term holders seems concerning, as the markets, specifically Cardano, could face excessive selling pressure. This could make ADA more challenging to regain the positive momentum in the short term, keeping the short-term targets activated. This could be a key reason why the Cardano price is struggling to hold its ground.
What’s Next for the ADA Price?
Now the big question: Is this just a dip or something more serious?
If Cardano can hold above the $0.6 level, we might see a bounce back toward $0.66 or even $0.70. But if that support breaks, $0.57 is the next line of defence. A drop below that? Then $0.50 could come into play quickly.
The current Cardano (ADA) price action is a mix of technical weakness, long-term holders selling off, and bearish trader sentiment. While it’s not time to panic, it’s definitely a moment to watch closely.
