ADA and DOGE stare at uncertain future
- ADA and DOGE could be affected by the Celsius’ decision to hold only BTC and ETH.
- ADA’s price could go downward and DOGE may not be faring any better.
The decision by Celsius Network to liquidate the altcoins in its reserves could have a severe impact on Cardano [ADA] and Dogecoin [DOGE]. On 15 June, the crypto lending platform disclosed that it planned on converting all its altcoin holdings into Bitcoin [BTC] and Ethereum [ETH] only.
Celsius will be selling all altcoins from all customers (except Custody and Withhold accounts) starting July 1st and will be converting them into Bitcoin and Ethereum.
— Celsians (@CelsiansNetwork) June 15, 2023
Read Cardano’s [ADA] Price Prediction 2023-2024
A look at Celsius’ reserves showed that DOGE and ADA were some of the largest assets held by the firm. At press time, Celsius held 535,161 ADA and 1,505,693 DOGE.
Celsius did not explicitly give reasons for the decision. However, speculation went around that it was connected to the unclear regulations around certain tokens, of which ADA was one. As a firm just recovering from insolvency, Celsius might be doing all it could to avoid any exposure to regulatory scrutiny.
For ADA, the liquidation plan could potentially create selling pressure when Celsius offloads it. This could temporarily dampen the price of ADA, especially as it faced a similar downtrend lately.
No demand for ADA
Based on the technical outlook, bulls’ repeated attempt to create demand at $0.354 has been futile and met with a sharp rejection. This has caused a downward slope, leaving ADA trading at $0.26.
And from the Moving Average Convergence Divergence (MACD) indications, the selling pressure could continue. At press time, the MACD was -0.007. A negative value of the MACD indicates that the 12-day EMA (blue) was below the 26-day EMA (orange).So, If Cardano fails to experience increased accumulation at $0.26, then it might be difficult to reverse to a positive trajectory.
As for DOGE, the impact of the liquidation plan may also depend on the extent of Celsius Network’s holdings and broader market sentiment.
DOGE’s buying strength is in the mud
Lately, the meme has experienced high volatility, indicated by the Bollinger Bands (BB). Also, the BB showed that DOGE has just exited an oversold region as the price shifted from touching the lower band.
While its price has fluctuated over the last few days, the short-term outlook for DOGE remains largely speculative. However, the Directional Movement Index (DMI) showed that the coin might tilt more towards the bearish side.
Realistic or not, here’s DOGE market cap in ADA’s terms
At the time of writing, the +DMI (blue) was 8.74. While the -DMI (red) was 36.62 (orange). By comparing highs and lows, this state suggests more downward pressure than the upward one.
In addition, the Average Directional Index (ADX), used to gauge uptrend or downtrend strength, supported the projection of a bearish outlook since its value was above 25. At press time, the ADX (red) was 42.74.