Cardano (ADA) risks a 70% drop amid Daedalus 5.1.0 updates

YEREVAN (CoinChapter.com) – Cardano (ADA) traded at $0.37 after a Bitcoin-copycat week. While Daedalus mainnet 5.1.0 introduced new upgrades, ADA charted within a pattern dubbed the ‘descending triangle’ since June 2022, which could cost the digital asset nearly 70% of its valuation.

ADA in a descending triangle

The bearish setup entails a dropping resistance and flat support. They enclose the price action and prevent sharp moves in either direction. The descending triangle is a continuation pattern that can forecast a drop equal to the one preceding the formation.

ADA confirmed the pattern by dropping below the support on Oct 10. Thus, the target price stands at approximately $0.1, or 70% below the current price.

Other bearish factors for Cardano

Several factors back the outlook, including the declining trading volumes since mid-May. In short, dropping buying pressure signifies traders’ reluctance to go all in on ADA, which could be attributed to the overall bearish climate on the market.

The latest CPI report revealed 8.2% year-over-year, standing above estimation, which could prompt the Fed to continue its quantitative tightening policies.

Subsequently, as the fear hit the markets, Bitcoin could confirm its own descending triangle and slump below the support at $18,500. If the bearish scenario plays out, Bitcoin is likely to take large altcoins along for the ride, including Cardano.

Cardano Daedalus 5.1.0 updates

Cardano’s desktop-only full-node wallet Daedalus introduced updates to its 5.1.0 version on Oct 13.

Daedalus mainnet 5.1.0 brings two updates to the hardware wallet integration. An updated LedgerJS package including the upcoming Ledger Cardano App 5.0.0 and Babbage support, and Trezor Connect update to version 9.

advertised Daedalus.

Additionally, the release will integrate “cardano-wallet v2022-10-06, which is compatible with the Babbage era” and fix the fee calculation performance deterioration. Daedalus 5.1.0 also introduces an optional anonymous usage data analytics collection that will help the team to prioritize new features and bug fixing.

Will Daedalus help ADA compete in the bearish market? It is not yet clear. However, the broader market conditions don’t favor Cardano bulls at the moment.