- Cardano (ADA) faces a potential 30% drop if it fails to hold the $0.51 support level, as broader market fears drive a sharp correction in crypto prices.
- The lack of upward momentum and ongoing global tensions suggest ADA may continue to struggle in the short term.
The cryptocurrency market is experiencing a sharp correction, with over $1 billion in liquidations taking place in just 24 hours. Bitcoin has dropped below $77,000, erasing more than 10% from its recent peak of nearly $90,000. Altcoins are feeling the heat even more, and Cardano (ADA) is no exception, suffering a 13% decline and hitting $0.55.
Cardano’s Critical Support Level at Risk
Cardano’s recent price action has raised concerns among traders and analysts. Currently, ADA is hovering just above the critical support level of $0.51, which has already been tested in this sell-off. If this support fails, ADA could face a significant drop of up to 30%, potentially falling to $0.35. Such a move would revisit the lows seen back in October and November, signaling further downside.
Technical Breakdown Looms for ADA
ADA has been following a descending triangle pattern, a bearish formation that suggests more downward pressure. Despite some attempts to rally, the token has been unable to break the $0.673 resistance level, and technical indicators remain bearish. Without a strong, sustained move above this level, the path of least resistance for Cardano appears to be lower, as traders continue to sell off in the face of broader market uncertainty.
Global Tensions Drive Market Downturn
The current market turmoil is driven by a mix of macroeconomic concerns. Escalating US-China trade tensions, fueled by Trump’s tariff threats, are putting the global economy on edge. This has triggered a risk-off sentiment across both equity and cryptocurrency markets. The fear of a trade war, combined with inflation concerns and slowing economic growth, is putting significant pressure on altcoins like ADA.
Will ADA Recover?
While some chart patterns, such as a potential double-bottom, hint at a bullish reversal, the lack of volume and follow-through makes this setup weak. Instead, the price action resembles an “ending diagonal” formation, which suggests that ADA could face another downward wave before any potential rebound occurs. Without a clear change in market sentiment or a breakout above $0.673, ADA’s future remains uncertain, and a further decline is more likely in the short term.
As the broader market navigates these turbulent times, Cardano and other altcoins will likely continue to trade cautiously. Until the macroeconomic landscape stabilizes or Bitcoin reclaims key levels, ADA and similar tokens will likely remain under pressure.
