- Cardano price has dropped 25% in the past week, currently trading at $0.71 after failing to sustain a bullish reversal.
- $4.66 million in liquidations could occur if ADA rebounds toward $0.77, but bearish sentiment remains strong.
- Despite oversold RSI conditions, ADA’s recovery is uncertain, and it may stay range-bound between $0.70 and $0.77 unless momentum shifts.
Cardano (ADA) continues to struggle as it fails to sustain any meaningful recovery, invalidating the previously anticipated bullish falling wedge pattern. Despite technical indicators suggesting oversold conditions, ADA remains under significant bearish pressure, with sellers maintaining control over the market.
Cardano Traders Face Liquidation Risks Amid Bearish Control
Cardano’s liquidation map reveals that over $4.66 million worth of ADA positions are at risk if the price rebounds toward the $0.77 resistance. This highlights the aggressive short positions taken by bearish traders, who have driven the funding rate negative, reflecting strong short interest and hesitation among bullish investors.
However, the broader market sentiment does not entirely support this bearish outlook. If an unexpected surge in buying momentum occurs, it could trigger short liquidations, potentially fueling a temporary price rally.
Oversold RSI Signals Exhausted Bearish Momentum
Cardano’s Relative Strength Index (RSI) has now entered the oversold zone for the first time in six months, typically indicating that bearish momentum is nearing exhaustion. Historically, such conditions have led to minor recoveries.
However, ADA has a history of failing to capitalize on oversold conditions, struggling to generate significant price rallies even when technical indicators suggest potential reversals. As a result, while short-term bounces are possible, expecting a sustained recovery remains speculative unless broader market conditions improve.
Cardano’s price is currently finding temporary support at the $0.70 level. However, the lack of bullish momentum suggests that ADA may remain range-bound between $0.70 and $0.77 in the near term.
A decisive breakout above $0.77 could shift market momentum, potentially triggering a short squeeze and fueling a rally toward $0.85. Flipping this resistance into support would be crucial for ADA to target the $1.00 mark.
However, without this breakout, upside potential remains limited, and ADA could stay trapped in a tight consolidation range. If support at $0.70 fails, further downside could follow, testing lower levels.
