Cardano’s Weekly Large Transactions Decline ! What’s Next For ADA Price?

The price of Cardano has remained in a bearish zone, struggling to attract buying interest despite a generally bullish trend in the overall market. This lack of buying demand has triggered large investors, commonly referred to as ‘whales,’ to exit, a trend highlighted by recent on-chain data. This could lead to reduced volatility in ADA’s price and might even invite increased selling pressure, particularly near its resistance levels.    

Whales Lose Interest In ADA Price

Unexpectedly, bulls found themselves in a challenging position with Cardano (ADA). Data from Coinglass revealed that the ADA price initiated a substantial amount of liquidation, totaling over $1.2 million. Notably, bullish traders faced a significant impact, with nearly $930K worth of their long positions being liquidated, strengthening the resistance level at $0.55.

Cardano’s inability to follow the rising bullish trend in the market and the impressive performance by other emerging altcoins has led to a declining interest among major investors, or ‘whales’. Recent data from IntoTheBlock highlights a notable decrease in large transaction volumes.

Since December, there’s been a sharp decline, with the metric falling from a weekly high of $153 billion on December 11 to just $15.8 billion by January 8, a 90% reduction. This trend suggests a declining likelihood of any significant price movements for Cardano in the coming days.

However, the recent decline in the MVRV ratio (Market Value to Realized Value) presents a strong buying opportunity for Cardano. Currently, the MVRV for ADA is at 0.92, indicating that its price is lower than its realized value, which implies undervaluation and a potential for investment. A ratio below 1 indicates that the realized capitalization, or the price at which each ADA was last transacted between wallets, exceeds the market value.

The bears halted Cardano’s recovery near the 50-day Exponential Moving Average (EMA) valued at $0.56, and intensified their selling pressure. Bears have successfully sent the price near EMA20; however, buyers hold confidence by defending the $0.48 support line. As of writing, ADA price trades at $0.507, declining over 0.7% from yesterday’s rate.

Bears are currently dominating as there’s an intense selling pressure above moving averages. The RSI is currently trading below the midline, suggesting an advantage for sellers. The bulls are attempting to initiate a rally starting from $0.56, but they might encounter robust selling at the 50-day EMA.

Should the price descend from its current level, it might test buyers’ patience at $0.48. A drop below that level might trigger another wave of long-liquidation. To avoid this decline, bulls need to quickly send the price above EMA50. Successfully doing so could lead the price gaining its pre-crash consolidation at around $0.64.

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