- Cardano was down 50% from its December peak of $1.3.
- At press time, ADA’s price hit a pivotal point, but demand was still weak.
Cardano’s[ADA] weekly losses topped 12% as bearish pressure continued following Bitcoin’s [BTC] drop below $90K.
Even the Grayscale Cardano ETF acknowledgment didn’t induce much demand, reinforcing macro uncertainty as a key risk factor for the altcoin and broader market.
However, the slight 2% drop in Bitcoin dominance was positive news, which could offer relief to altcoins, including ADA. So, what does price action imply?
Cardano hits pivotal level
Source: ADA/USDT, TradingView
At the time of writing, Cardano was down 50% from its December peak of $1.3, marking a multi-month downtrend channel (white). The current price action retested the channel’s range low, which also doubled as a bullish order block (likely support, cyan) at $0.69.
However, technical indicators show mixed signals. The daily RSI is below a neutral level, indicating muted demand. But the Chaikin Money Flow (CMF) flipped positive, suggesting improved inflows.
Simply put, ADA bulls could attempt to defend the range-low, if BTC recovers. On the contrary, a sustained sell-off could drag ADA to $0.56, the first cool-off zone after the post-US election upswing.
ADA’s speculative interest drops
Source: Coinglass
ADA’s weak demand was also evident in the Futures market. The altcoin’s speculative interest dropped over 60% from $1.48B in January to $555M, at press time. This meant investors withdrew money from the derivatives market, a bearish signal.
From a liquidity perspective, there were four key pockets of liquidity (bright yellow) worth tracking. The levels were $0.78, $0.75, $0.7 and $0.62.
Source: Coinglass
The $0.78 aligned with the channel’s mid-range level, while $0.62 coincided with the range lows. In case of a liquidity sweep, the altcoin could fluctuate between these key levels, especially if BTC fails to set a decisive direction.
