Cardano (ADA) is struggling to regain its upward momentum after a sharp decline, keeping the price below the critical $1 level.
The inability of this altcoin to recover recent losses reflects a gloomy outlook as it continues to consolidate within a narrow range. Weak investor sentiment, combined with a lack of significant price volatility, further complicates ADA's quest for growth momentum.
The price divergence - the Cardano DAA (Daily Active Addresses) is currently flashing a sell signal, indicating a weakening potential for price appreciation. This metric reflects a declining number of active participants interacting with the blockchain, further reducing buying pressure. Such a trend signals potential price declines for this altcoin if market conditions do not change.
The lack of price appreciation is causing increasing concerns. It is evident that the investor base is dwindling as the trading volume of ADA remains stagnant. If market participation does not increase, Cardano's prospects for a significant recovery will diminish, making the altcoin more vulnerable to further price declines.
The macroeconomic drivers of Cardano also point to pessimistic challenges. Whale activity has declined significantly, with the number of transactions over $100,000 dropping to a 6-week low. This declining trend reflects the hesitation of large investors, who typically have a significant impact on market dynamics.
High-value transactions have decreased to 5,560 in the past 24 hours, consistent with the lack of price appreciation in ADA in recent days. Large investors appear to be waiting for stronger recovery signals before re-entering the market, further dampening the short-term recovery prospects of ADA.
The ADA price is currently consolidating around $0.91, trading within a narrow range of $0.87 to $1. The sideways movement over the past week signals a diminishing opportunity for recovery as the market remains sluggish. The lack of a decisive breakout further reinforces the downward price momentum.
If the current bearish indicators persist, ADA is likely to continue consolidating or drop below $0.87. The subsequent decline could push the price to $0.77, causing significant losses for investors. This scenario would further solidify the bearish outlook unless market conditions improve.
On the other hand, if investors regain confidence and market signals change, ADA may surpass the $1 mark. Achieving this level would negate the bearish case and potentially trigger a rally towards higher targets. However, such a recovery would require substantial buying pressure and broader market support.
Disclaimer: This article is for informational purposes only and not investment advice. Investors should do their own research before making decisions. We are not responsible for your investment decisions.
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Dinh Dinh
According to Beincrypto
