- Cardano’s ADA is currently facing a potential $2 billion sell-off as short-term holders eye profits, with the altcoin unable to break past the $0.39 resistance level.
- According to one analyst, sharing his views on TradingView, suggested that Cardano is poised for a 33% price drop.
Cardano’s ADA has been facing a precarious moment in the market. As a result of this, short-term holders are eyeing potential sell-offs amid great market uncertainty.
At the time of writing, ADA is swapping hands with $0.3323, representing a 0.19% surge in the last 24 hours. On the flip side, this price represents a 2.44% and a 1.65% price decline in the past week and month, respectively. This digital asset has failed to break the $o.39 barrier level.
This price stagnation has generated a negative market sentiment, with the situation on the brink of worsening if small-scale investors decide to cash out on their gains.
This market price has been consolidating between $0.31 and $0.39. This price range suggests that the altcoin currently holding the 11th position is struggling to gain enough upward momentum for a breakout.
According to Market Value Realized Value, short-term ADA holders are more likely to garner profits than long-term holders. Cardano’s MVRV long/short difference currently stands at -20%.
Typically, a high negative MVRV signals profitability for short-term investors, whereas a positive suggests that long-term holders are in the money. In this case, with the current readings, short-term traders have the potential to pocket profit.
Diving in deep, short-term investors currently hold around 5.7 billion ADA out of the 35.67 billion ADA in supply. Also, this holding is valued at approximately $1.9 billion. It’s worth noting that these traders often hold ADA for less than a month and are likely to sell as soon as they see an opportunity to profit. The slightest idea that this substantial portion of this supply should hit the market all at once poses a risk for a potential sharp decline.
Increased selling pressure could push Cardano below its critical $0.31 support, causing a steeper price drop. The overall market sentiment remains bearish, and the concentration of ADA ownership among short-term holders heightens this risk.
ADA Poised for a 33% price decline
Analysts are increasingly bearish on Cardano. One analyst, alias “FinancialFreedomGoals,” gave a more bearish prediction about digital assets. According to the analyst, who shared his views on TradingView suggested that Cardano is poised for a significant 33% price drop. The altcoin’s continued struggles to gain traction in the market, coupled with its stagnant or declining value, have fueled these pessimistic forecasts.
However, if short-term investors opt to hold rather than sell, ADA may have a chance to reclaim bullish momentum. A breakout past the $0.39 resistance level, followed by a flip of this price level into support, would signal a renewed upward trend.
