- Cardano has formed a double top pattern on the daily chart, hinting at a bearish reversal.
- A surge in ADA spot inflows indicates that selling pressure may intensify, pushing prices lower.
Cardano (ADA) has underperformed Bitcoin (BTC) over the past seven days, with the altcoin up a modest 0.4%, trading at $0.347 at press time. ADA has shown signs of consolidation over the past 24 hours, with its price fluctuating within a narrow range between $0.339 and $0.35.
ADA’s bearish pattern emerges
Considering that the daily chart is showing the formation of a double top pattern, the bearish trend around ADA may continue. This pattern usually shows a trend reversal, and if sentiment is not positive, ADA is now poised to move to the downside.
ADA bears tested the neckline of this double top pattern at $0.339, the 100% Fibonacci level, before the price rebounded. If ADA violates this support and moves lower, the price will likely plummet to $0.319.
(Source: Trading View)
ADA would need to bounce above $0.37 to nullify this bearish pattern and confirm an upward trend. But it lacks the buying support needed to make those gains.
The relative strength index (RSI) is 46, indicating that sellers are in control. Additionally, the RSI line is sloping south, showing that bearish momentum is strengthening. Negative Chaikin Money Flow (CMF) is also showing weakness as selling pressure continues.
Data from Coinglass confirms that ADA traders are actively selling. Spot inflows recently surged to $4.28 million, the highest level since mid-August. This means that traders are moving their coins to exchanges for the purpose of selling.
Source: Coinglass
Derivatives data analysis
Looking at the derivatives market, we can see that sentiment is positive but bearish signals persist. ADA’s open interest increased to $238 million per capita at press time. coin glass. This indicator is at its highest level this month, indicating strong interest in altcoins.
ADA’s long/short ratio is 1.07, which shows that there are slightly more long traders than short traders. On Binance, over 90% of Cardano’s open positions indicate long-term market optimism.
Source: Coinglass
Read Cardano (ADA) price prediction for 2024-2025
Despite this long-standing bias, traders betting on ADA profits continue to post losses. In the last 24 hours, $441,000 worth of ADA longs were liquidated, while only $16,750 of shorts were liquidated.
Nonetheless, whale activity could signal a turnaround in ADA prices. Recent Large ADA Transactions spike It suggests that whales may accumulate.