In a court filing on Monday, the United States Securities and Exchange Commission (SEC) included Cardano (ADA) among the tokens identified as securities. This news precipitated a 10% price retracement, and on-chain data indicates a low probability of an imminent ADA price recovery.
Cardano (ADA) has been one of the worst-performing assets in the top 10 global cryptocurrency rankings this week. Unrealized losses have reached critical levels, and it remains to be seen if beleaguered investors will cease selling and aid in the price recovery of Cardano.
According to Market Value to Realized Value (MVRV 30d) data, most crypto investors who purchased Cardano in the past month now rests on significant unrealized losses. With a 13 percent net loss position, strategic Cardano investors may become reluctant to sell.
Moreover, the gradual decline in ADA Age Consumed indicates that long-term investors are decreasing their selling activity. Age Consumed assesses the trading sentiment of long-term investors by monitoring the number of recently transferred coins multiplied by the number of days since their last transfer.
Let’s see the Cardano ADA price prediction from the ADA Forecast.
Cardano (ADA) Faces An Extreme Selling Pressure
The overall price direction in the ADA/USDT daily chart is bearish, as multiple large red candles are easy to spot. Therefore, the long-term investors have started HODLing their assets until there is a clue about the recovery. The fundamental-driven sentiment initiated the selling pressure, which exhausted the price below the 0.2329 critical support level. 0.782 level. Although a minor recovery is pending as a mean reversion with the 20-day EMA, there is no sign of a bullish reversal.
In the indicator window, we can see the Aroon Up and Down line, which represents the strength of the early trend. According to this indicator, the Aroon Down (Red dynamic line) is above the Aroon Up (Green dynamic line). It indicates that the early trend for ADA/USDT has changed from bullish to bearish with Aroon Down’s test of 100% line, followed by a crossover. It is a sign that the broader outlook is bearish and valid until the Aroon Down line comes below the 50.00 line.
Based on the current price structure, it may relieve some pressure from the mean reversion but a daily candle with a long shadow is needed to be formed above the 0.2392 level. Moreover, the 0.2983 level would be a strong barrier to bulls as any rejection from this zone could resume the existing bearish trend.
Cardano (ADA) Ichimoku Cloud Analysis
The H4 chart shows a clearer view of strong selling pressure in the ADAUSDT price. After the cloud breakout, the price moved down with extreme selling pressure. Moreover, multiple H4 candles were formed below the dynamic Kijun Sen line, which is a sign of an active seller's presence in the market.
The above image shows that the price came below the dynamic Kijun Sen while the future cloud changed the sentiment from bullish to bearish. Also, the TDI level reached the lower boundary, which is a sign of strong downside momentum.
Based on the current structure, the price may show a bullish recovery but a stable market above the 0.2887 level could indicate a bullish reversal.
On the other hand, the downside pressure may resume if any bearish rejection comes from the 0.2700 to 0.2887 area.
Cardano (ADA) Intraday Price Action Analysis
In the H1 chart, the price remained extremely bearish below the visible range high volume level at 0.3245 level.
The above image shows that the MACD Histogram is in the bearish territory while the price moves lower. Moreover, the bearish crossover in the MACD line and intraday high volume level’s presence at 0.3245 indicates an active selling pressure in the market. Therefore, as the current price trades below the dynamic VWAP and 20 EMA, sellers may regain the pressure below the 0.2300 level.
On the other hand, intense buying pressure with a bullish H4 close above 0.3300 would alter the current price structure by taking the price above the 0.5000 level.
Is Cardano (ADA) A Buy?
According to the Cardano (ADA) price prediction, ADA/USDT is not a buy as the macro outlook is positive about the broader crypto market. However, the 0.2392 level is the main area to look at as the only hope is to find an exhaustion above this level with a bullish daily candle.