Cardano (ADA) is facing a critical test of its support level, with a 6.5% drop possible if it breaks below $0.90. The asset has been consolidating within a tight range between $0.90 and $0.96 for four days, but traders’ interest has skyrocketed, leading to a surge in futures trading volume.
A recent spike in trading volume reached $6.96 billion, the highest level in five months, indicating strong interest from investors and institutions. However, this increase in trading volume also signals that traders are heavily betting on the bearish side, with major liquidation levels set at $0.876 on the lower side and $0.928 on the upper side.
On-chain analytics data suggests a mixed sentiment, with investors and long-term holders accumulating tokens during the price dip. This could help ease downside momentum and restore buying pressure. Despite this, the asset’s technical indicators, including the TD Sequential and Supertrend, remain bullish, indicating a potential bounce ahead.
If ADA breaks below $0.90, it could lead to a 6.5% decline, potentially dropping to $0.835. However, if the price holds above the support level, it could repeat history and reach the $0.969 mark again. A major rally would only occur if the asset breaks out above the upper boundary, which could trigger a 28% price uptick.
For now, Cardano remains in an uptrend, with the Supertrend indicator still in green and hovering above the price. The asset’s price action and technical analysis suggest that it is facing a make-or-break situation, but the current data indicates that investors are cautiously optimistic about its prospects.
Source: https://ambcrypto.com/ada-price-risks-a-6-5-drop-if-0-90-support-breaks-can-it-happen