TL;DR
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ADA has slipped substantially from its December 2024 peak, recently failing to break key resistance. A renowned analyst warns the slump could intensify in the near future.
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Despite the bearish outlook, whales bought over 410 million ADA in April, signaling renewed confidence. Combined with a low RSI near overbought levels, this could hint at a potential bullish reversal.
ADA to Bleed in the Following Days?
Cardano’s ADA performed quite well towards the end of last year, with its price surging past $1.30. Despite its brief spikes in the next several months, though, it has been on an evident downtrend since then. Currently, ADA trades at roughly $0.66 (per CoinGecko’s data), representing a 45% decrease compared to the local peak observed in December 2024.
Popular analyst Ali Martinez recently explored the asset’s performance during that period. He argued that Cardano’s native token was rejected at the top of its descending channel, which has been in play for the past half-year. That said, Martinez believes the valuation could continue to decline to $0.63 or even $0.54 “if pressure persists.”
Approximately a week ago, the X user touched upon the same pattern. Back then, ADA was worth around $0.72, and he envisioned a pump toward $0.88 in the event of a breakout above the key level of $0.74. The price, though, could not pass that important barrier.
The Bullish Scenario
Contrary to the assumption of a nearly 20% correction in the short term, some essential factors signal a potential price resurgence. In April, whales accumulated more than 410 million tokens, which, at current rates, equals roughly $270 million. This represents a much different strategy than the selling spree witnessed in late February and mid-March.
When large investors fill their bags, it usually indicates a growing confidence in the asset’s future performance. Smaller players closely monitor those actions and might also hop on the bandwagon, distributing fresh capital into the ecosystem.
ADA’s Relative Strength Index (RSI) also signals potential good times for bulls ahead. The momentum oscillator, which measures the speed and magnitude of recent price changes, varies from 0 to 100. Readings below 30 could be interpreted as bullish, suggesting the asset has entered overbought territory and may be on the verge of a rally. The ratio currently stands just north of that mark.
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