Cardano (ADA) tested a significant long-term support zone on Tuesday as the altcoin continues to extend its downtrend. Cryptocurrency is getting closer to a significant price level that has acted as a major turning point throughout the earlier market cycle.
As of writing, ADA is changing hands at $0.2656 with a 2.12% loss on the day, according to CoinMarketCap data. Meanwhile, the trading volume declined by 34.41%, recording $526.43 million. The token is experiencing a 10.46% loss on a weekly basis.
Source: CoinMarketCap
ADA Recovery Hinges on Crucial $0.305 Level
In an X post, More Crypto Online, the analyst highlighted that ADA might have tried to set a significant low last week as the asset was experiencing a prolonged corrective phase. He stated that confirmation requires ADA to break relevant resistance levels.
The analyst explained that the token needs to reclaim the $0.305 level to show diminishing pressure on the asset. He emphasized the need for coin to make a strong and impulsive move before a potential recovery.
Source: X
He added that ADA may still move sideways or show irregular price swings. He warned that patience is necessary while the market works through this phase. He also noted that failure to reclaim resistance keeps the short-term structure cautious.
According to another analyst, Karman Asghar, ADA is still bearish in the lower time frames. The trendline break is still required to change the momentum. Without the trendline break, the buyers do not have enough confirmation to start the buying process.
Source: X
Also Read: Cardano (ADA) Eyes $0.33 Resistance: Is a Breakout on the Horizon?
Open Interest Falls as Funding Turns Negative
CoinGlass data shows that the volume of futures had declined by 3.60% to $790 million. The Open Interest has also gone down by 1.52% to $418.04 million. The OI Weighted Funding Rate stood at -0.0096%. This indicates that the overall market is slightly negative.
Source: CoinGlass
RSI and MACD Highlight Weak ADA Momentum
The Relative Strength Index (RSI) is at 33.45, and the signal line reads at 33.26. These levels were close to the oversold territory. The levels pointed to a weak buying signal and a phase of fatigue for the sellers.
The Moving Average Convergence Divergence (MACD) shows that the MACD line stood at -0.0287, while the signal line is at -0.0262. The histogram sits at -0.0025, which confirmed the bearish momentum. The lines were also close to each other, indicating that the momentum could change as the buyers step in.
Cryptocurrency is at a critical phase on the price chart. The price was closely observed for a break above the resistance, volume, and structure. Until that time, the price was expected to fluctuate slowly around the key support zone.
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