Cardano’s Next Steps: How Sellers and Holders Are Shaping ADA’s Future

NAIROBI (CoinChapter.com) — Cardano (ADA) continues to face downward pressure, trading at $0.325 as of Aug. 16. The cryptocurrency is currently grappling with strong resistance at $0.367, a level that once served as solid support before collapsing on Aug. 5.

The struggle continued amidst a broader market downturn, with the global crypto market cap declining by 2.62% over the last day to $2.04 trillion.

Can ADA Overcome the $0.367 Resistance?

As of Aug. 16, ADA USD is trading at $0.325, down 3.85% over the past day. It has a market cap of $11.69 billion and a 24-hour trading volume of $403.48 million. The ADA is grappling with a key resistance level at $0.367 as broader market conditions remain bearish.

The daily chart reveals a descending triangle pattern, a bearish continuation signal. This pattern, characterized by lower highs converging toward flat support at $0.318, often precedes further declines, especially in extended bear markets.

Adding to the bearish sentiment, daily active addresses for ADA have seen a sharp decline, dropping from 36,657 on Aug. 8 to around 10,000, according to Santiment data. This decline indicates reduced retail participation and growing bearish sentiment.

Coinglass data further supports this outlook, showing $649.1k liquidated in the past 24 hours, with $549.81k from long positions. The market mood leans toward further sell-offs.

The Market Value to Realized Value (MVRV) ratio for Cardano suggests ADA may be nearing undervalued territory. A low MVRV ratio often indicates undervaluation, which could attract buyers.

Trading Volume Soars as Long-Term Holders Show Confidence

Long-term holders of Cardano show optimism despite bearish signals. Coinglass data reveals a net outflow of $1.75 million in ADA from exchanges in the past 24 hours, totaling $4.87 million over the past week.

The trend suggests holders are transferring ADA to personal wallets, reducing its circulating supply on exchanges, which could lead to upward price pressure.

Additionally, Cardano’s Total Value Locked (TVL) in DeFi protocols has been rising, reaching $199.27 million, according to DeFiLlama. This increase in TVL signals growing participation in DeFi initiatives, which could support ADA’s price.

In contrast to the declining price, ADA’s trading volume has surged 128.38% in the last 24 hours, reaching $465.76 million, according to Coinglass. This increase in volume could indicate renewed interest from traders, potentially setting the stage for increased volatility in the coming days.