Cardano’s ADA has experienced a downturn in a generally bearish crypto environment, losing around 22% in the past month.

Analysts remain split; some predict further losses while others foresee a potential significant recovery.

More Pain Ahead?

As of now, ADA is trading around $0.36 according to CoinGecko, down from over $1 earlier this year. The market cap has dropped below $13.5 billion, further distancing ADA from the top 10 cryptocurrencies.

Renowned analyst Ali Martinez observed the currency’s trajectory and suggested it might continue to decline toward a support level of $0.29, which would indicate a 20% drop from present levels. He previously indicated that ADA’s “SuperTrend” had turned bearish, recalling the last time this occurred, ADA suffered an 80% drop.

A user known as Node predicted additional downside for ADA, expressing a preference for shorting the asset to mitigate risks amid a potential bear market. Underlining this stance, they stated:

“Every little bounce we get is an easy short until conditions change.”

The Chances of a Rally

Contrarily, there are also predictions of a potential surge in ADA’s value. Marzell, another X user, claimed that early signs of recovery for the asset are emerging, demonstrated by bullish patterns in RSI/MACD. Nevertheless, he warned that achieving a price breakout towards $0.50 hinges on overcoming current price barriers.

Crucial indicators hint that ADA may be preparing for a rally. Its Relative Strength Index (RSI) has dipped below 30, marking an oversold condition that could precede an upward movement. The RSI is a momentum indicator that gauges the pace and magnitude of recent price changes; levels under 30 typically suggest a bullish outlook while those over 70 could indicate a correction.

Additionally, ADA’s netflows have shown significant outflows exceeding inflows in recent months, suggesting investors might be shifting away from centralized exchanges toward self-custody, reducing immediate selling pressure.

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