Why the ADA Coin Price May Remain Below $1
Layer 1 token Cardano (ADA) has been consolidating within a price range since early December. However, its price has been trending downward over the past week, falling 17% in the past seven days.
This decline was caused by a variety of factors, including selling by large shareholders and profit-taking by many holders. This puts the altcoin at risk of remaining below the $1 price level in the short term, as detailed in this analysis.
Cardano profit-taking activity surges
Cardano’s major shareholders’ net flows dropan indicator that tracks the buying and selling activity of large investors or whales, confirmed that this group of token holders has reduced their ADA accumulation. Data from IntoTheBlock shows that the net traffic of major ADA users has plummeted by 139% in the past seven days.
Large holders are whale addresses that hold more than 0.1% of the asset’s circulating supply. When net flows decline, it indicates that whales are selling their holdings. This is a bearish sign that these large investors may be losing confidence in the future price of the asset.
Recently added Profit taking within ADA The market is not limited to large investors. This trend has extended to most token holders, reflecting a general loss of confidence in the asset’s future price potential.
Supporting this sentiment is the continued decline in the market value to realized value (MVRV) ratio of altcoins. Santiment data shows the MVRV ratio peaked at 113% on December 2 and then began to decline. As of the latest update, the ratio is 72.35%.
This metric tracks whether an asset is overvalued or undervalued relative to its holders’ average cost basis. When it decreases, it indicates that the gap between an asset’s market value and its realized value is narrowing.
In the case of ADA, while still remaining positive, the declining MVRV suggests that holders are taking profits, thereby reducing the extent of unrealized gains. This indicates that bullish sentiment in the market has weakened and selling pressure has increased.
ADA Price Prediction: May Drop to $0.77
Technically, the daily chart shows The next major support for ADA lies in $0.90. While it was trading at $1.01 at press time, increased profit-taking activity will cause it to test this support level. If it fails to hold, the coin’s price will plummet to $0.77.
On the other hand, if buying activity picks up again, ADA coin price may rebound to $1.06 and climbed to a two-year high of $1.32.
Disclaimer
conform to trust project Guide, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to providing accurate and unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult a professional before making any financial decisions. Please note that our terms and Conditions, privacy policyand Disclaimer Updated.
