Cardano
Cardano – Why Bitcoin won’t save ADA’s price and whales just might
Though other cryptocurrencies also fell, ADA’s movement was worse-off. And, it may remain so in the near-term.
- ADA’s 0.14 correlation with Bitcoin places it at further risk despite recent correction
- Bulls might help the token rise towards $0.55 in the short term
Cardano [ADA] was one of the altcoins hit hard by the price crash of the last 24 hours. At press time, ADA had lost 13.27% of its value within the aforementioned period while trading at $0.50. This, after ADA dropped briefly to $0.46 on the charts.
Cardano’s performance meant that it suffered a heavier loss than other cryptocurrency in the top 10. As a result, the number of ADA holders in loss hiked too.
Using data obtained from IntoTheBlock, AMBCrypto found that only 36% of ADA holders were making money at its press time value. On the opposite end, a whopping 57% of holders have to deal with unrealized losses.
Source: IntoTheBlock
BTC might not lend ADA a helping hand
However, this occurrence cannot be attributed to the recent decline alone. For a while, the market has been in an early bull phase, but Cardano has underperformed. This has sparked speculations if the altcoin would ever help all of its holders break even this cycle.
One stumbling block here is its correlation with Bitcoin [BTC]. If you follow the market religiously, you will observe that BTC has a strong correlation with many top altcoins. However, ADA has not been able to join this cohort with a price correlation
of 0.14. The price correlation ranges between 0 and 1. Therefore, the reading above implies that Bitcoin’s bounce might not necessarily mean ADA’s recovery.Apart from the short-term forecast, the long-term outlook did not look promising for ADA either. This, because of the actions of some whales.
Lower conviction, lower prices?
According to AMBCrypto’s on-chain analysis, whales’ balances has been falling. For instance, we observed that those holding 1 million to 1 billion tokens have liquidated some of the ADA held.
On 15 March, the 1 million to 10 million cohort held just 16.70% of the total supply. However, at press time, that percentage had fallen to 16.20%.
It was a similar situation for the 100 million to 1 billion group which initially owned 7.01 % around the same period. However, figures for the same fell to 5.92%, at press time.
Source: Santiment
An action like this suggests decreasing confidence in Cardano’s long-term potential. In the meantime, the Relative Strength Index (RSI) was 31.76, indicating that bulls were trying to take ADA out of the oversold region. Previously, the price crash sent the RSI to 19.53, suggesting an extreme bearish
momentum.A successful bullish attempt, backed by dip buying, could push ADA up to $0.55. However, inadequate firepower could invalidate this thesis, and ADA might keep swinging between $0.49 and $0.52 in the short term.
Source: Santiment
Read Cardano’s [ADA] Price Prediction 2024-2025
In addition, several factors excluding the ones mentioned above might impact where ADA moves next. For the long-term prediction, the price action after Bitcoin’s halving might determine if the token is worth holding or not.
