Cardano (ADA) Bullish Momentum Under Pressure as $1 Hangs By a Thread

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As a seasoned researcher who has witnessed numerous market fluctuations and trends, I find myself cautiously optimistic about Cardano‘s short-term potential, but with a hint of concern regarding the current downward trend. The signs of selling pressure from large holders and the decreasing number of ADA holders are indicators that suggest we might be in for a drop below the $1 mark.

Due to recent fluctuating prices, there’s a potential for Cardano (ADA) to dip below the significant $1 level. For several days now, its value has been unpredictable, moving up and down, and over the weekend, it has found it hard to maintain stability, remaining in roughly the same price range.

For those holding ADA, there’s optimism that the present volatile swings might lead to an upward breakthrough. However, this on-chain examination seems to suggest otherwise.

Cardano Short-Term Potential Faces Setback

Initially, it’s possible that the token’s price may decrease because the net activity of significant Cardano token holders suggests a downward trend. The large holders’ netflow tracks the actions of accounts that control between 0.1% and 1% of the total circulating supply.

When the net flow increases, it signifies that more tokens were purchased than sold at these addresses. Conversely, a decrease in the net flow suggests that distribution is increasing while accumulation is decreasing. As reported by IntoTheBlock, the net flow for large Cardano holders has dropped to 142% over the past seven days.

It seems like the altcoin has been under significant selling force throughout the specified timeframe. As a result, considering the present situation, we may not witness a substantial increase in ADA’s price in the near future. Rather, it appears more probable that its value will decline.

Besides the given measure, the count of ADA holders serves as an additional indicator that could signal a possible reduction in the token’s worth. Generally, an increase in cryptocurrency holders often signifies optimism about the currency’s near-term prospects.

Additionally, it suggests an increasing interest, potentially causing a price hike. Conversely, a decrease in the count of wallets holding it might imply otherwise. Specifically, as of November, there were approximately 4.47 million Cardano holders.

At the present moment, the number has dropped to 4.4 million. This decline indicates that some people holding ADA may have cashed in on the substantial price rise the token experienced since November. If this trend persists, it could potentially signal a decrease in the altcoin’s value as well.

ADA Price Prediction: Lower This Time

According to the analysis of a 4-hour chart, the price of Cardano (ADA) has fallen beneath not only its 20 but also its 50 Exponential Moving Averages (EMA). The EMA serves as a tool to monitor fluctuations in the value of a cryptocurrency, helping us understand the overall trend.

If the price of Cardano climbs over its Exponential Moving Average (EMA), it indicates a positive or bullish trend. But in this specific situation, the value of Cardano has fallen beneath both its 20 EMA (blue) and 50 EMA (yellow). This downward movement implies that there’s a potential risk for the altcoin to dip below its $1.05 base support level.

If it happens as suggested, ADA may drop to approximately 0.95 temporarily. But if buyers manage to drive the price past the stated indicators, this forecast would no longer hold true. Instead, ADA might surge towards $1.19 or possibly even higher in that case.

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2024-12-16 15:40