- Cardano drops 15%, testing critical support near $0.33.
- Technical indicators show continued bearish pressure and limited short-term buying momentum.
- Whales and accumulation near support could influence possible rebounds or further declines.
Cardano’s ADA recently faced significant pressure, with ADA losing around 15% over the past week. The token traded near $0.34 on January 25, testing a critical support area around $0.33. Traders are watching this zone closely, as buyers have historically stepped in here. The market shows signs of accumulation, but broader technical signals remain cautious. Analysts now weigh in on potential price movements and what traders should watch next.
ADA Navigates a Persistent Bearish Channel
Cardano continues moving within a clear descending channel on the two-day chart. The pattern shows a series of lower highs and lower lows, reflecting consistent selling pressure over recent months. Attempts to break above the upper boundary of the channel have repeatedly failed. Each rally stalled before prices fell back to the lower edge, keeping ADA confined within this range.
Technical data from TradingView highlights the middle line of the channel as a key balance point. Prices often return to this area before the next directional move. If buying pressure increases, ADA might attempt to climb toward the middle range. However, resistance remains strong near the upper zone, which sits between $0.60 and $0.70. Any rally reaching these levels would likely act as a temporary correction unless ADA breaks and holds above the channel.
Analyst Butterfly noted that ADA recently found support near the lower edge. Buyers appear to accumulate tokens as selling pressure weakens. This activity suggests the market is testing demand and building a foundation for potential short-term rebounds. Traders now watch the $0.32 to $0.33 range closely, as breaking below it could accelerate declines while keeping the bearish channel intact.
Weekly Indicators and Market Participation Highlight Caution
Weekly technical indicators point to continued downside risk for ADA. The token trades below all major exponential moving averages, signaling sellers retain control. The 20-week EMA sits near $0.50, while longer-term EMAs range between $0.57 and $0.61. These levels highlight the gap buyers must overcome to shift momentum.
The Money Flow Index reads 16.8, showing weak inflows and limited new buying power. The MACD remains negative, with bearish momentum building. The Relative Strength Index stands at 39, underlining short-term selling strength. Together, these metrics indicate market pressure remains firmly skewed toward sellers.
Open Interest on Binance futures recently dropped to $108.55 million, the lowest since December 25. Reduced participation suggests waning interest among traders opening new positions. Earlier in January, ADA faced rejection at the 50-day EMA near $0.39. This triggered a nearly 10% decline, highlighting the strength of resistance and the vulnerability of support levels.
