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The price of Cardano has rebounded, but the result looks familiar. Since January 20, ADA has risen about 7%, then briefly pushed higher before pausing and settling near $0.35. This was not an escape. This was another jump that failed to build a follow-up to the objectives.
Three factors explain why Cardano price bounces continue, and why the same arrangement still remains.
The first reason: a weak hidden upside divergence that ignites the bounce
The recent bounce was the result of a subtle bullish divergence on the 12-hour chart. Between late December and January 20, he investigated ADA price The lower low is higher while the RSI indicator has recorded a lower low very recently.
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These details are important. A shallow RSI decline indicates a slight decrease in selling pressure, not that buyers have taken control of the market. This type of divergence usually leads to short-term rebounds, not sustained rallies.
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And that’s exactly what happened. The price of Cardano rose about 7% to $0.37 on January 21, but the movement quickly stopped.
The timing explains why. On January 21, when the price was approaching $0.37, Cardano’s development activity score reached close to 6.94, its highest level in about a month.
Development activity reflects the amount of work done on the chain and often supports confidence in the price. In mid-January, the Local Americans with Disabilities Act rate followed a peak in local development activity.
But this support led by the development did not sustain. The development activity has decreased, bringing the price with it. It has now risen to around 6.85, but the monthly maximum has not been broken. This divergence halted sales, but did not create enough demand to grow while development stalled.
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The second reason: the profit booking increases every time the price of Cardano increases
The bigger issue is what happens next To start Cardano On the rise
The age range for coins spent tracks the number of coins of all age groups that are moved. High values ​​usually indicate selling and taking profits. In the past month, every price rebound has been followed by a sharp increase in currency activity.
At the end of December, the price of Cardano increased by about 12%, while the activity of the token jumped by more than 80%, demonstrating aggressive selling power. In mid-January, the ADA index rose by about 10%, and the activity of spent coins increased by about 100%, confirming once again that players took advantage of the rise to exit their positions.
The same behavior is back now. Since January 24, coin activity has increased by more than 11% from 105 million to 117 million, although the ADA price has not yet increased. This indicates that sellers are anticipating another bounce rather than waiting for confirmation.
That’s why momentum keeps fading. Each upward attempt is met with faster profits than the previous one.
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Third reason: Whales reduce exposure to old materials, they don’t absorb sales
Whales usually help absorb this kind of selling pressure. Currently, they do not.
Wallets holding between 10 million and 100 million ADA reduced their balance from about 13.64 billion ADA to about 13.62 billion ADA, a decrease of about 20 million ADA since January 21st. As of January 22, portfolios holding between 1 million and 10 million ADA decreased by approximately 5.61 billion ADA, approximately 60 billion ADA for 1 5.60 billion ADA.
These are not out of panic, but are clear net reduction. This lack of whale demand means that profits are no longer being absorbed, making the price more vulnerable to downward pressure when it arrives.
Derived data reinforces this weakness. Over the next seven days, the short qualifier is close to $107.6 million, while the long qualifier is close to $70.1 million. Put outperforms long positions by more than 50%, showing that traders are waiting for rallies to fail rather than extend.
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This imbalance indicates that the market expects selling pressure to return quickly if Cardano tries another rebound, especially near resistance.
Cardano price levels that determine what happens next
The price structure now makes things clearer.
On the upside, $0.37 remains the first critical level. A clean break and hold above it results in a short liquidation and provides temporary relief. However, $0.39 is much more important. A move above this zone will eliminate most of the remaining downside and represent the first tangible change in momentum. After that, $0.42 is the level where the broader structure could be bullish again.
On the downside, it is the main support at $0.34. Losing this level wipes out a large portion of remaining long positions and could quickly accelerate downward pressure as leverage eases.
in order to Cardano exits this loopThree things must be agreed. Development activity needs to recover and maintain its recent highs. Off-currency activity should slow down rather than rally in bounces. The whales must return as net buyers.
Until then, Cardano’s price rebounds remain at risk.
