Cardano‘s ADA token experienced significant volatility this week, briefly climbing above $0.235 on a scaling solution milestone before retreating near $0.22. Extensive liquidation data pointed to leveraged long traders facing steep losses in the process.
Leios testnet launch drives ADA spike
The Cardano Foundation stated that Leios, a new public testnet developed in collaboration with Input Output Group and Intersect, is now live. This development enables stake pool operators to begin testing, with simulations projecting processing speeds of 100 to 1,000 transactions per second when eventually deployed to mainnet—a marked increase from the current 4.5 kilobytes per second capability.
Mini dictionary: Leios testnet, an experimental Cardano network upgrade focused on increasing transaction throughput, is designed to address blockchain scalability by offloading certain transactions and data, leading to anticipated higher speeds and capacity for the Cardano network.
Additional positive developments for Cardano included joining a Mastercard program on cross-border settlement and deploying node version 11.1.1 to mainnet earlier in September. These successive announcements within two weeks fueled optimism and triggered a short-term surge in ADA’s price. However, the upswing proved unsustainable as order books showed signs of an overheated market that quickly reversed course.
Bullish momentum fades on technical charts
Despite the breakout to $0.235, broader technical analysis on Cardano remains cautious. ADA remains in a downtrend since its 2025 high near $1.32, with lower highs signaling ongoing bearish structure. Price continues to hover above multi-month support at $0.145, a crucial level that has repeatedly served as a gathering point for sell-side liquidity.
On the daily timeframe, ADA recovered from a demand zone in early September between $0.16 and $0.18, reaching as high as $0.235. The current trading range extends from $0.145 up to resistance near $0.305, with ADA now fluctuating in the center of this broad band.
| Key ADA Levels | Status |
|---|---|
| $1.32 | 2025 cycle high |
| $0.305 | Daily resistance |
| $0.235 | Recent spike / short-term resistance |
| $0.2150-$0.2220 | Key support pocket |
| $0.195 | Order block base |
| $0.145 | Major support/liquidity pool |
Liquidation data reveals heavy long losses
According to CoinGlass data, open interest in ADA stood near $506.5 million, while Binance reports showed a long-to-short account ratio of 2.01. This suggested retail traders were heavily skewed toward bullish positions as ADA approached its local peak.
Leveraged long positions were liquidated far more aggressively than shorts, resulting in approximately $811,000 in long liquidations over 24 hours versus only $88,000 in shorts—a roughly nine-to-one imbalance. During the sharp drop from $0.235, long traders absorbed nearly $689,650 in forced closures, indicating that many bulls entered late and exited at a loss as momentum faded.
These figures highlight how the sudden reversal left many over-leveraged traders exposed, illustrating the risks of chasing rapid price spikes during periods of heightened volatility.
Broader market context and next moves
The correction in ADA followed a session where Bitcoin also edged down toward the low $80,000s, accompanied by a rise in exchange reserves. Across the altcoin market, assets regained their 200-day averages, underscoring that recent losses stem from a wider pullback rather than Cardano-specific factors.
Traders are monitoring whether ADA can hold the $0.2150 to $0.2220 support zone. A sustained reclaim of $0.235, driven by spot market demand instead of short covering, could put resistance at $0.305 back in focus. A drop below $0.2130 may see bears push ADA back toward $0.195.
Technical signals indicate that the outcome of the $0.2150 to $0.2220 support range will shape ADA’s direction over the coming sessions, with both opportunities and risks present at current levels.
