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Cardano’s Price Recovery May Be Unlikely Anytime Soon – Here’s Why!
By Akashnath S
As the cryptocurrency market continues to face a plethora of challenges, it appears that Cardano (ADA) might not experience a price recovery anytime soon. In this article, we will delve into the reasons why Cardano’s price recovery may be unlikely in the near future.
First and foremost, the heavy selling pressure that has been observed amid fearful market conditions is likely to have an impact on ADA. The crypto market’s recent downturn has led to a significant decline in the number of active addresses, as reflected by data from Santiment. This trend would need to reverse for Cardano’s price recovery to be possible.
Furthermore, the development activity that was seen during Cardano’s previous rallies has not been replicated recently. In fact, data suggests that this metric has been on a downtrend since February. Given the significance of dev activity in driving the asset’s growth, this drop would be a major concern for long-term investors.
In addition to these negative trends, it appears that any potential price bounce would likely be quickly overwhelmed by selling pressure as holders exit at break-even or even slight profit levels. This is because the 90-day MVRV ratio has been positive for nearly two months now, indicating that holders of ADA are in profit. The share of holders in profit has been falling rapidly, further emphasizing this point.
Furthermore, it appears that the mean coin age metric, which reflects network-wide distribution, has also turned bearish. This development does not bode well for Cardano’s price recovery prospects.
Lastly, a crucial market structure change is required to turn the tide. The asset’s recent drop below the $0.71-level marks a major bearish flip in its chart pattern. It appears that ADA may need to retest and hold onto this level as resistance before a meaningful bounce can occur. With the sellers firmly in control, it seems unlikely that such a scenario will play out anytime soon.
In conclusion, it is possible to argue that Cardano’s price recovery may be an uphill battle for the time being.
Source: ambcrypto.com
