- ADA funding rates turn negative, signaling bearish sentiment in the market.
- Cardano’s Total Value Locked (TVL) continues to decline, reflecting weaker network activity.
- ADA price faces downward pressure, testing key support around $0.52.
Cardano’s (ADA) price continues to struggle this week, trading around $0.52 after a decline of over 10%. The drop highlights the bearish sentiment surrounding ADA as market conditions worsen. Cardano’s Total Value Locked (TVL) and funding rates are both signaling a negative outlook, adding to the pressure on ADA’s price.
Bearish Sentiment Reflected in Derivatives Data
ADA’s funding rate turned negative this week, a signal that more traders are betting on the token’s price to decrease. According to Coinglass OI-Weighted Funding Rate data, the negative funding rate of -0.057% suggests a higher number of shorts compared to longs. This shift indicates that sentiment is leaning toward further price declines.
Alongside the negative funding rates, Cardano’s TVL has been steadily declining. As of Friday, the TVL stood at $244.14 million, a significant drop from mid-August levels.Â
This continuous fall signals a reduction in user engagement and activity within the Cardano ecosystem, which may contribute to the ongoing bearish trend in ADA’s price.
ADA Price Faces Key Support Zone at $0.52
ADA has been trading within a descending channel since reaching a high of $0.61 on November 11. The current price of $0.52 is testing a critical support zone that has previously triggered small rebounds.
The Relative Strength Index (RSI) is also sitting at 35, indicating that ADA may be oversold. This could suggest that the current price level could serve as a potential bottom.
However, the Moving Average Convergence Divergence (MACD) is showing decreasing bullish momentum, further suggesting that the market remains under bearish pressure. If ADA manages to hold the support level at $0.52, it could see a short-term recovery. The next resistance level lies around $0.58, a potential target for a rebound.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. CoinCryptoNewz is not responsible for any losses incurred. Readers should do their own research before making financial decisions.
