Cardano (ADA) Drops 39% After Joining US Crypto Reserve: What Comes Next?

Cardano (ADA) has lost almost 10% in the last 24 hours and almost 29% in the last week. It is under a lot of selling pressure. ADA has dropped 39% over time since it was added to the U.S. strategic crypto reserve, and it is still struggling to recover.

Indicators such as DMI and BBTrend reveal that a bearish attitude is still strong with sellers in control. ADA could test important support levels if the present downtrend keeps on, but a reversal might push it toward significant resistance zones.

ADA Price Under Heavy Selling

The Cardano BBTrend indicator is currently at -19.52 and has been declining since yesterday. BBTrend stayed positive earlier this month, between March 5 and March 8, reaching a peak on March 6 at 31.

This change from positive to negative territory shows that the bullish trend is weakening, which means that the price of ADA is under more and more downward pressure. Traders are now waiting to see if this drop will continue or if ADA can get back on track.

Source: TradingView

BBTrend, an indicator that uses “Bollinger Bands,” is a tool that uses Bollinger Bands to track price changes. It tells you if an asset is strong, going up, or going down. If the BBTrend is positive, it means that prices are going up quickly. A negative trend indicates a rapid decline in prices.

ADA’s BBTrend, which currently stands at -19.52, indicates that people are becoming more bearish; thus, unless buyers step in, the price could keep declining. ADA might test significant support levels in the coming days if the overall trend is down.

Cardano Chart Shows Sellers Still In Charge

The Directional Movement Index (DMI) chart shows Cardano’s average directional index (ADX) rising from 26.6 yesterday to 34.5 today. This increase suggests that, whether the ADA’s present trend is rising or declining, it is getting stronger. A rise in ADX signifies increased pressure to sell, given the current decline in ADA, which could lead to a swift price turnaround.

On a scale from 0 to 100, ADX shows how strong a trend is. Values above 25 show a strong trend, and values above 50 show an incredible trend.

Furthermore, ADA’s +DI (positive directional index) has gone up from 9.6 yesterday to 12, but it’s still a little lower than 13.8 from a few hours ago, which shows that bullish attempts are not forceful.

The DI (negative directional index) is right now at 29 while this is occurring. Though it is less than yesterday’s 32.3, it has increased from 25.2 a few hours ago.

This means that sellers are still in charge of the trend, but some short-term pullbacks are happening. If DI stays dominant and ADX keeps rising, ADA’s declining trend could extend further.

Will ADA Fall Below $0.60?

Cardano EMA lines suggest that a bearish momentum could be indicated by a possible death cross that will form soon. Usually resulting in higher selling pressure, a death cross is the event whereby a short-term EMA falls below a longer-term EMA. The ADA price could fall even more if this bearish crossover happens. The $0.58 support level will become an important area to keep an eye on. If this level is broken, even more money could be lost.

Source: TradingView

The price may rise toward the $0.818 resistance level, though, if buyers take back control and ADA can change its trend. If it breaks above that, it could lead to more gains toward $1.02 and even $1.17 if the momentum builds.