Cardano (ADA) recently experienced a price rebound amid a broader market recovery, yet several analysts are urging caution. Several experts are now recommending a short position on the cryptocurrency, forecasting a potential decline toward $0.20—a drop of approximately 43% from its current value.
Lingrid’s Bearish Analysis
One prominent analyst, Lingrid, has been vocal in recommending a short position on ADA. According to Lingrid, Cardano has shown signs of weakness, as it remains stuck below the critical $0.35 resistance level. The broader cryptocurrency market has been moving sideways, and ADA’s failure to break above its key resistance suggests mounting pressure toward the downside.
Lingrid’s analysis highlights that the digital asset trades between $0.30 and $0.34 on the daily timeframe. The formation of a doji candle on the daily chart is a sign of market indecision, which could lead to a retest of support levels around $0.325 as traders look for stability.
Should Cardano fail to hold the $0.325 support level, Lingrid warns that the price could continue its descent toward the $0.30 zone. The analyst believes that ADA’s inability to break out of the current range presents an opportunity for traders to take short positions. Based on this outlook, Lingrid issued a sell recommendation for the token.
Analyst Projects Cardano (ADA) to Drop to $0.20
Another well-known market observer, FinancialFreedomGoals, has echoed similar concerns regarding ADA’s price trajectory. According to the analyst, the majority of altcoins, including Cardano, are currently in a downtrend, and the technical indicators suggest that ADA may face further declines.
Cardano recently broke out of a rising wedge pattern, accompanied by increased trading volume. However, this breakout was bearish and has only reinforced concerns about ADA’s downward potential. The token continues to trade below the 200-day Exponential Moving Average (EMA), a sign that it remains firmly entrenched in a bearish trend.
FinancialFreedomGoals also pointed to the Moving Average Convergence Divergence (MACD) indicator, which recently turned bearish as the MACD line crossed below the signal line. This technical signal further supports the view that downward momentum would continue.
According to this analysis, the next key support levels for ADA lie around $0.2506 and $0.2197, based on Fibonacci retracement levels. A drop to the lower target of $0.2197 would represent a 33% decline from the current price of approximately $0.33.
If this scenario plays out, the loss would be more severe when measured from ADA’s peak earlier this year, when it traded near $0.80. In that case, a fall to $0.2197 would represent a staggering 73% loss from its high.
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Cardano (ADA) Resistance at $0.3815
Despite the bearish sentiment, both Lingrid and FinancialFreedomGoals have acknowledged that a break above the $0.3815 resistance level could offer some hope for bulls. This level represents a key area of resistance, and surpassing it could signal a potential reversal for ADA. However, the probability of such a breakout remains low given the current market conditions and technical indicators.
For now, analysts are closely watching ADA’s price action, with the majority leaning toward further declines. Should the token fail to maintain support at key levels, the bearish targets around $0.20 may come into focus.
Disclaimer: This content is meant to inform and should not be considered financial advice. The views expressed in this article may include the author’s personal opinions and do not represent Times Tabloid’s opinion. Readers are urged to do in-depth research before making any investment decisions. Any action taken by the reader is strictly at their own risk. Times Tabloid is not responsible for any financial losses.
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