- Whale sell-off of 70 million ADA leads to a 20% price drop, raising concerns.
- Cardano’s outflows outweigh inflows, indicating long-term holders are reducing positions.
- RSI at 49.74 shows neutral momentum, while MACD signals potential selling pressure.
Cardano ($ADA) has recently caught the attention of analysts, as its price behavior suggests both bullish and bearish possibilities. While some experts remain optimistic about Cardano’s future, others caution that the current market conditions may continue to weigh heavily on its performance.
Dan Gambardello, a well-known crypto analyst, pointed out that Cardano is forming a bullish weekly pattern with an inverse head and shoulders. This technical setup, featuring an upward-sloping neckline, typically signals potential for a price rebound.
However, not all signals are bullish, as recent whale activity and technical indicators show a more complex picture.
Whale Activity and Market Dump Concerns
Over the past 48 hours, significant whale movements have stirred concerns about the stability of Cardano’s price. Analyst Ali Martinez reported that whales offloaded over 70 million ADA, contributing to a sharp decline in the price of the cryptocurrency. This massive sell-off has had a clear impact, with Cardano’s value dropping more than 20% since the market began to show signs of a crash.
However, it’s important to note that such market corrections are not unusual during periods of heavy whale trading. These sell-offs often result in short-term price volatility, which may provide buying opportunities for those with a longer-term outlook.
Outflows Outpace Inflows Amid Declining Prices
In addition to whale activity, inflows and outflows of Cardano also offer crucial insights into investor sentiment. A closer look at Cardano’s transaction data from November and December reveals a trend of increased outflows, which outpaced inflows during this period.
The outflows suggest that long-term holders may have sold off significant portions of their positions, particularly around the $1.20 price level, likely to lock in profits before further price declines. Conversely, inflows coincide with small price recoveries, possibly driven by short-term traders or those covering their short positions.
Cardano’s Current Technical Indicators: Neutral or Bearish?
As of press time, Cardano’s price stands at $0.915, down 8.11% in the last 24 hours. Current RSI is currently hovering around 49.74, signaling a neutral market sentiment. A move above the 50 mark could indicate the potential for a bullish trend. However, if the RSI drops below 40, bearish sentiment may dominate.
Additionally, the MACD has shown a bearish crossover, with the signal line crossing below the MACD line. This suggests selling pressure is present, although a reversal near support levels could trigger a bullish crossover, shifting the momentum in Cardano’s favor.
