Cardano’s ADA Could Experience a Further Decline, Warns Crypto Channel
Cardano’s native token, ADA, may be facing another decline, according to a recent session posted on the crypto channel More Crypto Online. The session highlighted the confirmation of this signal by the Elliot Wave, a technical theory that analyzes recurrent price patterns to identify tops and bottoms of market cycles.
Unfortunately for ADA, its breakdown below the crucial support level of $0.48 has invalidated any bullish bias. As a result, the price could potentially slide down to Wave 5, indicating a significant downward movement. The predicted target for ADA’s price is $0.42.
At the time of writing, ADA was priced at $0.45, representing a 2% decrease in the last 24 hours.
Exploring Cardano’s Potential from an On-Chain Perspective
Technical analysis alone does not suffice when evaluating the potential of a cryptocurrency like Cardano. Therefore, it is important to consider on-chain data as well.
One important metric to examine is Open Interest (OI), which refers to the sum of all open positions in the derivatives market. An increase in OI suggests a rise in net positioning and the possibility of aggressive buyers (longs).
However, Cardano’s OI currently stands at $548.6 million, indicating a decrease from its value seven days ago. This decline implies that sellers (shorts) are more aggressive, further supporting the prediction of a decline to $0.42.
In addition to OI, the liquidation levels and Cumulative Liquidation Levels Delta (CLLD) were analyzed. CLLD predicts price levels where large liquidations may occur and can help traders make informed decisions regarding long or short positions.
While there was no magnetic zone on the chart that could attract a price rise in Cardano, the CLLD was positive, indicating the potential for a full retrace. This bearish bias may limit ADA’s ability to initiate an upward movement, with a possible target of $0.40 in a highly bearish scenario.
Overall, the recent analysis suggests that Cardano’s ADA could experience a further decline, contradicting previous indications of a bullish trend. Traders and investors should closely monitor these developments to make informed decisions regarding their ADA holdings.