Cardano’s Critical Test Between $0.80 and $0.66

Cardano (ADA) is currently trading in a significant support zone between $0.80 and $0.66, an area that has historically impacted price movements.

The cryptocurrency market remains volatile, with ADA witnessing a 2.65% decline in the past 24 hours and a 20.20% drop over the last week.

ADA’s Key Support and Resistance Levels

ADA’s current price is returning to the $0.80–$0.66 support range, which has previously functioned as both resistance and support during market cycles. Analyst Ali Martinez suggests that holding this level could be crucial for ADA’s future.

Historical data indicates that Cardano struggled to maintain this range in mid-2022, leading to a significant price drop. In 2023, it experienced rejection at this level before breaking above it in early 2024. Now, it is once again testing this important support area.

Successfully holding above $0.66 could initiate a price recovery, while a drop below may lead to further declines.

Technical Indicators Signal Uncertainty

Market indicators for ADA show mixed signals. The Bollinger Bands indicate that ADA is near the lower band at $0.5386, suggesting it may be oversold. The middle band at $0.7871 serves as immediate resistance, while the upper band at $1.0356 is a key breakthrough point.

The Relative Strength Index (RSI) is 47.04, indicating neutral conditions. If the RSI goes above 50, it could suggest increasing buying pressure; however, a drop below 40 may indicate growing selling activity. Furthermore, the MACD shows a bearish crossover, where the MACD line is below the signal line, suggesting a potential continuation of the downtrend unless momentum changes.

Market Activity and Investor Sentiment

According to Coinglass, ADA’s trading volume surged by 66.40% to $3.53 billion, highlighting increased market activity. Conversely, Open Interest declined by 9.49% to $831.18 million, indicating traders are closing their positions amid uncertainty. Meanwhile, options volume has plummeted by 92.94% to $6.59K, reflecting diminished speculative interest.

Address activity has increased, with IntoTheBlock reporting a 7-day rise in active addresses (11.99%), new addresses (4.79%), and zero-balance addresses (12.26%), suggesting renewed engagement with the network, even though ADA is trading significantly below its all-time high of over $3.00 in 2021.

Declining Large Transactions Raises Concerns

Whale activity has decreased significantly, as shown by the drop in large transactions. On December 10th, transactions peaked at 12K but fell to 4.73K in the last 24 hours. This reduction in large transactions indicates waning interest from major investors, which may hinder upward price movement.

Currently, ADA is trading between $0.80 and $0.90, and its ability to remain above key support levels will be crucial for regaining momentum. A rebound above $0.80 could push the price towards $1.00, while failing to hold $0.66 may lead to lower prices. Amid high volatility, traders will be closely monitoring ADA to see if it can stabilize or if another downturn is imminent.