- ADA faces critical support at $0.458, with potential further decline to $0.420 if this level fails.
- Technical analysis shows ADA’s bearish trajectory, trading below key EMAs and Fibonacci levels.
- On-chain data indicates declining user engagement and new entrants not retaining ADA, signaling bearish sentiment and potential price drops.
Cardano (ADA) is currently facing crucial support identified at $0.458. Should this support fail, prices could drop further to around $0.420. On the other hand, resistance levels are noted at $0.525 and $0.592; surpassing these could indicate a shift to a bullish trend.
Technical analysis on the 4-hour chart reveals ADA’s bearish trajectory. The cryptocurrency is trading below both the 100 EMA at $0.464 and the 200 EMA at $0.472, indicating bearish momentum in the short to medium term. Additionally, the price remains under the 0.618 Fibonacci level at $0.458, a vital support area. The RSI is currently at 42.57, below the neutral mark of 50, signifying strong selling pressure. A continued decline in RSI could signal further price drops.
On-chain data shows a reduction in user engagement and short-term trading activity, negatively impacting Cardano’s market outlook. The analysis of daily active addresses indicates a downward trend, suggesting decreasing user participation and transaction activity. This reduction is a bearish signal, reflecting waning interest in the Cardano network.
New entrants into the ADA ecosystem are not retaining their holdings for long. Instead, they are selling quickly or using their coins in ways that result in zero balances. This behavior indicates a lack of long-term commitment from new users, which is bearish, as sustained price stability and growth depend on investors holding onto their ADA. In the past week, new addresses decreased by 33.53%, active addresses by 9.34%, and zero balance addresses by 28.32%, reinforcing the narrative of declining interest and participation in the ADA network.
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