Key Points
- Cardano’s ADA has seen a 10% decline in the past 24 hours, currently trading at $0.415.
- Analysts suggest the cryptocurrency may rebound to the $0.50 region as $0.40 support holds firm.
Despite being one of the top ten cryptocurrencies by market capitalization, ADA has experienced a significant loss, dropping by 10% in the last day. This downturn coincides with rising interest rates and a decline in open interest.
However, on-chain metrics indicate that Cardano might be poised for a short-term recovery.
Derivatives Data Intensifies ADA’s Challenges
According to data from CoinGlass, open interest in Cardano futures has fallen by 13% in the last 24 hours to $725.61 million. This drop suggests a significant reduction in active positions, both long and short, indicating traders’ current disinterest in the cryptocurrency.
As risk sentiment wanes, ADA’s funding rate has decreased to 0.0019%, down from 0.0047% recorded earlier this week, signaling a bearish shift in sentiment.
Moreover, short positions account for 54.62% of all active positions in the past day, further indicating traders’ bearish outlook on ADA’s price trajectory.
Nevertheless, on-chain data from Santiment reveals that ADA transactions hit a nine-month high of 4.11 billion on Tuesday, suggesting a potential price rise in the short to medium term.
Daily active addresses also reached a four-month peak at 34,229, indicating a renewed interest in the Cardano network.
Potential for Cardano to Surpass $0.50
The ADA/USD four-hour chart shows a bullish pattern, supported by the formation of a Market Shift structure. While technical indicators remain bearish, there are signs that they could soon turn bullish, especially as ADA retains support at $0.40.
The RSI at 36 indicates ADA remains in bearish territory; however, the MACD lines are in positive territory, hinting at increasing bullish momentum.
If the trend reverses, ADA could rebound toward resistance at $0.50 within hours or days. This upward movement could potentially lift Cardano’s prices to around $0.6069, marking a peak from November 11.
Failure to maintain current levels might lead ADA to retest its December 1 low at $0.3707 in the coming hours or days.
