Over 4 Million ADA Sold in a Week: Is Cardano Facing More Downturn?
The recent selling spree by Cardano whales has raised concerns about the digital currency's short-term prospects as it faces continued depreciation.
Cardano (ADA) has experienced a significant sell-off, as over 4 million tokens were offloaded by large holders in the past week, based on insights from on-chain analyst Ali Martinez. This action coincided with a 10% decrease in ADA’s price over the same timeframe.
Despite a momentary bounce in price, overall market conditions appear stressed.
Selling Wave from Whales
Large wallets holding between 100,000 and 1,000,000 ADA have significantly decreased their holdings since late October, with ADA’s value sliding from above $0.60 to approximately $0.53.
“Whales have offloaded more than 4 million Cardano $ADA in the past week!”
— Ali (@ali_charts) source
This trend is also reflected in the on-chain metrics showcasing diminishing total holdings among this cohort. The intensified selling pressure is contributing negatively to ADA’s ongoing price decline.
CryptoPotato noted that major holders have progressively reduced their ADA stakes in recent weeks, and without passionate buying support to absorb this influx of tokens, price levels might continue to feel the squeeze.
Market Sentiment and Potential Signs of Recovery
General sentiment surrounding ADA is gloomy. According to Market Prophit, both retail and model-driven signals project a bearish outlook: “CROWD = Bearish 🟥, MP = Bearish 🟥.”
However, Ali Martinez identified a potential turning point, suggesting that the TD Sequential indicator on the three-day chart shows a prospective buy signal for ADA, as it marked a red “9” candle, often indicative of the nearing end of a downward trend. While not definitive of a recovery, it may reveal that the rapid sell-off is subsiding.
Additionally, technical indicators indicate ADA is approaching oversold territory with a Relative Strength Index (RSI) reading of 34.62, nearing the typical oversold threshold of 30 which historically aligns with brief rallies.
Source: TradingView
ADA is still trading below the 9-day Exponential Moving Average, currently positioned at $0.57. A reversal above this threshold could indicate a change in momentum; otherwise, the downward trajectory is expected to persist.
Technical Support Levels Under Scrutiny
Technical analysis displays ADA as resting on a significant trendline near $0.50, within a demand zone that has previously provided price support. CryptoPotato has further observed that buy interest has been present in this region before.
Should a break occur from this area, it could trigger upward movements, potentially targeting a return to $1.30. Lucky commented, “ADA is looking good here,” yet cautioned that this would only hold if current support remains intact; otherwise, the setup would collapse.
