Cardano's Powerful Bull Run Weakens, potential for ADA to revisit its yearly minimum levels

Cardano's Powerful Bull Run Weakens, potential for ADA to revisit its yearly minimum levels

Slammin' News on Cardano (ADA): Bulls Lose Grip Amid Crypto Market Consolidation

The scene for Cardano (ADA) is turning grim as bulls seem to be struggling in the broader consolidation of the crypto market over the past week.

Technical signals suggest that ADA's bullish presence in the spot markets is dwindling, and this could potentially push the price back to its year-to-date low of $0.50.

ADA: Bear Power on the Rise as Buying Action Stalls

Cardano's Elder Ray Index, a bellwether for the ratio of bulls to bears, is showing a consistent drop, indicating weakening appetite for buying. The daily chart's readings display a steady reduction in the size of the histogram bars, signaling a decrease in bullish power.

As the size of the Elder Ray Index bars gradually shrinks, it usually means that the gap between bullish and bearish forces is narrowing. When bullish pressure weakens and bears take over, the histogram bars shrink, often acting as an early warning system for a trend reversal or increased bearish momentum.

In simpler terms, ADA's buyers are steadily losing ground, paving the way for a deeper correction.

Moreover, Cardano's Chaikin Money Flow (CMF) is in the negatives and has been treading below the zero line since Monday. As of now, this momentum indicator, which measures money flowing in and out of ADA, stands at -0.09.

A CMF reading in the red, like the one we see here, indicates more selling pressure than buying pressure, ** suggesting a possible further drop in ADA's value in the near future.**

Cleaning House: ADA Bulls Fight to Protect $0.66 Support Level

Currently trading at $0.69, ADA teeters above the support formed at $0.66. If bullish action weakens any further, ADA could slide under this support level and find itself back at the year-to-date low of $0.51.

On the flip side, a surge in demand for ADA will prevent this from happening. If there's a resurgence in Cardano's bull market, the support at $0.66 will toughen up, pushing ADA's price up to $0.76.

Takeaways: Factors Affecting Cardano's Bearish Movements

Multiple factors are contributing to Cardano's bearish trend:

1. Technical Signals:
2. Death Cross: Cardano is edge-lingering its first "death cross" of 2025, where the 50-day SMA falls below the 200-day SMA, an indication of a prolonged downtrend.
3. Fear and Greed Index: While the Fear and Greed Index stands at 67, a reading that typically points towards greed, Cardano's market sentiment remains neutral to bearish, with 47% of indicators suggesting a negative outlook.
4. Market Sentiment and External Factors:
5. Macroeconomic Uncertainty: The broader macroeconomic climate, along with volatile markets due to comments from Fed Chair Jerome Powell on an unstable economic forecast, is contributing to ADA's decline.
6. Limited Development Activity: Cardano's low Total Value Locked (TVL) and scarce developer activity have drawn criticism, branding it a "ghost chain." This diminishes its real-world utility and adoption compared to other platforms.
7. Recent Performance:
8. Price Ups and Downs: ADA has suffered since hitting a high of $1.19 in early March 2025, following a strategic crypto reserve announcement. At the moment, ADA is trading below $0.65, reflecting a substantial drop from previous highs.

Looking Ahead: What This Means for Cardano in the Short Term

The implications of these factors on Cardano's immediate future include:

1. Prolonged Downtrend: If the death cross occurs, it might lead to a sustained downtrend, intensifying ADA's price decline. However, historical data shows mixed outcomes from such technical signals.
2. Market Volatility: Broader market conditions can influence ADA's price, potentially keeping the coin on a rollercoaster ride.
3. Potential Revival: Despite the current downward spiral, a break above $0.75 would theoretically lift ADA towards $1, provided Cardano strengthens its tech and fundamental framework. However, achieving significant long-term gains to surpass previous highs like $3.10 would necessitate substantial improvements in developer activity and DeFi participation.

Disclaimer

This analysis is for informational purposes only and should not be taken as financial advice. BeInCrypto endeavors to provide accurate, unbiased reporting, but the crypto market is subject to changes without notice. Always conduct your own research and consult a financial professional before making any financial decisions. In adherence to the Trust Project guidelines, please be aware that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.

1. The consistent drop in Cardano's Elder Ray Index suggests a weakening appetite for buying, indicating that the bulls might be steadily losing ground.
2. A Cardano Chaikin Money Flow (CMF) reading in the red, like the one we see currently, indicates more selling pressure than buying pressure, suggesting a possible further drop in ADA's value in the near future.
3. Cardano is edging towards its first "death cross" of 2025, where the 50-day SMA falls below the 200-day SMA, which could indicate a prolonged downtrend.
4. The current market sentiment remains neutral to bearish, with 47% of indicators suggesting a negative outlook, despite the Fear and Greed Index standing at 67.
5. The broader macroeconomic climate and volatile markets, along with limited development activity and criticisms of Cardano as a "ghost chain," are contributing to ADA's decline.

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