Disclaimer: The findings of the following analysis are the author’s sole opinion and should not be taken as investment advice

Demand was barely there behind Cardano despite heavy losses in recent months. Another price drop could come in the coming weeks

Cardano price action has been heavily bearish in recent months. Several key levels have been lost to the bears since April. The number of Cardano wallets has skyrocketed over the past month.

Further, 66,000 transactions were completed a few days ago on the Cardano network, according to Adaverse.

Read Cardanos [ADA] Price forecast 2023-2024

They did nothing to add conviction to lower time frame bulls. The price has seen little volatility over the past three days. Higher timeframe traders may wait for a higher move before assessing the likelihood of another bearish move.

The $0.315, $0.34 levels are holding and the bulls are not holding much strength in the markets

Source: ADA/USDT on TradingView

On the daily time frame, the downtrend was evident. This meant that long-term investors can wait for a change in trend before buying. Any buying opportunities will likely be limited to shorter time frames like short term play.

The Relative Strength Index (RSI) has been consistently below the neutral 50 mark since September. In early November, bulls hoped for a move above 60 on the RSI, but these hopes were quickly dashed. The On-Balance Volume (OBV) was in a downtrend alongside the price.

On Nov. 15, the price of ADA tried to bounce, but it turned out to be only the formation of a bearish order block on the daily time frame. A retest of this zone on Dec. 5 saw ADA quickly reverse and plunge from $0.329 to $0.306 a few days later.

The $0.315 level has been important for years and served as resistance in January 2021 and May 2018. This was the level Cardano bulls were struggling with at the time of writing. A plunge below $0.3 could send ADA down to $0.245. Meanwhile, a retest of the aforementioned bearish order block at $0.33-$0.338 may provide an opportunity to go short.

Active addresses plateaued while dormant circulation saw a spike during the November sell-off

Source: Sentiment

Despite the sharp drop in prices at the beginning of November, development activity experienced a dramatic upturn. This was an encouraging sign for long-term investors as it indicated that price movements did not matter on the development side.

The dormant circulation (180 days) saw a huge spike in early November, showing that a large number of previously dormant ADA were changing hands. This reinforced the idea that there was strong selling pressure during that week of fear and panic.

Over the next two weeks, the $0.33-$0.34 area will be an important resistance zone. A retest of this area as support based on good demand could signal a rally towards $0.36-$0.375

This post With the ADA bulls exhausted, a shorting opportunity could be just around the corner

was published first on https://ambcrypto.com/with-ada-bulls-exhausted-a-shorting-opportunity-could-be-around-the-corner/


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