Cardano (ADA) price has been volatile following a major market trend. Bitcoin plunged 20% over the past week and major altcoins followed suit. With Bitcoin revisiting a level it hasn’t touched for months, other altcoins have fallen significantly.
In just 24 hours, ADA registered a 20% drop and over the past seven days, the coin recorded a market cap loss of over 30%. ADA has been one of the worst performing altcoins of the month, causing investors and buyers to flee the market.
Continued selling is likely to cause the coin to fall further and take a rest near the $0.40 mark. Among other worrying factors, such as rising inflation, rising interest rates and an impending recession, the weakness of the broader market could continue to disturb the stability of the crypto industry.
Cardano Price Analysis: Four-Hour Chart
ADA was priced at $0.50 at the time of writing which is a 60% drop from the all-time high of $3 in September last year. The coin has noted a near 35-week downtrend and the recent bearish price movement has made it almost impossible for the coin to demonstrate a possibility of a rebound. The coin continues to depict highly oversold conditions.
The coin shows a downward trend (yellow), confirming the bearish thesis. At the current price level, Cardano may find support at $0.40.
Investors may fight that scenario as a buying opportunity that could propel ADA prices to the upside. In case of a rally which looks quite tough, ADA could target $0.62.
Cardano’s volume displayed a red bar which is a bearish sign, which also means that the coin is selling at the time of writing.
technical analysis
Cardano tried to retest its $0.62 level over the past few days, but bears pulled the altcoin down. At the time of writing, ADA was trading well below the 20-SMA line. This means that the sellers were increasing the movement of the price of the coin in the market.
After breaking out of the downward trend, ADA briefly tried to rally, bringing the coin back into the overbought zone as buyers briefly gained confidence as seen on the Relative Strength Index. Thereafter, however, ADA barely recovered in terms of buying strength as the coin continued to juggle between the oversold zone and the underbought zone.
Related Reading | ADA discount? Cardano whale goes on $200M buying spree
The ongoing bearish thesis has dampened investor sentiment, with the coin currently experiencing a distribution phase due to a sell-off.
The Chaikin money flow which determines the outflow of capital was observed below the half line. This reading indicated that capital outflows far exceeded inflows.
The Awesome Oscillator indicating price movement is indicated by an amplified red histogram. A red histogram below the zero-line indicates bearish price action for the coin.
Related Reading | Cardano (ADA) Real Volume Indicates Downtrend Is Far From Over
Featured image from UnSplash, chart from TradingView.com