Cardano (ADA), important support level while extending its 30-day decline. The tenth largest cryptocurrency by market cap may experience this in the short term as downward pressure continues to increase.
Daily Addresses on Cardano Decrease
Although the decline in the popular altcoin reflects the overall market downturn at that time, it may also be due to the steady decrease in ADA demand by market participants. ADA’s daily active addresses, observed using the 30-day moving average (MA), decreased by 25% last month. When a token’s daily active addresses decrease, it usually indicates fewer unique addresses interact with it daily.
The decrease in demand for cryptocurrencies last month may be linked to the low profits from ADA investments during that period. Evaluating ADA’s daily profit/loss transaction volume ratio (using the 30-day MA) shows a price of 0.87. This indicates that only 0.87 of every ADA transaction resulted in profit last month. It also means ADA holders experienced more losses than gains in the last 30 days. ADA’s price, evaluated on a 1-day chart, revealed the formation of a descending triangle. At the time of writing, ADA is trading at $0.43, positioned at the lower trend line forming a critical support level.
Current Data on ADA
When a token’s price is in a downtrend, the formation of a descending triangle indicates the continuation of downward price movement. ADA’s key momentum indicators also pointed to the likelihood of continued decline if bearish sentiment persists. For example, the altcoin’s relative strength index (RSI) remained below the neutral line of 50.0, signaling that investors might prefer distributing tokens over accumulating them. Consequently, if ADA breaks out of the triangle and violates support, the next price point would be $0.42. If bulls cannot halt the decline, it may drop below $0.40 and trade at $0.36.
