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The price of Cardano has witnessed a tight consolidation phase in recent days. ADA is trading in a range that gradually narrows as momentum weakens. Attempts to break higher levels were repeated, but stopped, reflecting the broad state of caution in the digital currency market.
Negative signals dominate the short-term forecast. However, a larger class of coin holders provides the necessary support.
Cardano is under pressure
Cash flow index data indicates continued selling pressure on ADA. The index remains below the neutral 50 level, indicating continued capital outflows. Weak flows indicate that buyers are reluctant to enter the market at current prices.
A change in importance requires you to recover the 50 level or enter the oversold zone. For now, the ADA is far from both ways. Without a strong reversal signal, selling pressure may continue to affect Cardano’s price action.
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Derivative statements confirm the negative narrative. The settlement chart shows that Cardano futures are leaning towards short positions. The volume of open positions on short contracts is about $23 million compared to $14 million in potential liquidation of long contracts.
This imbalance highlights traders’ expectations for a further slowdown. A high selling interest can increase volatility if the price moves sharply. However, the current situation suggests that many traders expect continued weakness rather than a bump higher.
Continuing short positions can amplify price volatility. If ADA tries to recover, sales could accelerate the rally. In turn, more sales can reinforce the negative momentum. Currently, sentiment in futures markets remains defensive.
Long-term ADA holders provide some relief
Currently, long-term coin holders continue to offset some of the selling pressure. A higher average coin age indicates that older coins remain inactive. This trend reflects that long-term investors prefer to hold the coins rather than distribute them.
Flexibility among long-term investors is crucial. The continuous holding behavior reduces the circulating supply pressure. Although it does not guarantee a recovery, it helps ADA defend critical support levels during periods of uncertainty.
The ADA price must be above this support
Cardano is trading at $0.264 at the time of writing, moving in a range between $0.295 resistance and $0.256 support. The lower limit corresponds to the 13.6% Fibonacci retracement, which is often referred to as a bear market support level. The source stated that ADA has maintained this level for about three weeks.
Current indicators indicate that the consolidation situation is likely to continue. Successful defense of $0.256 could allow a rebound towards $0.278. Continued buying may also push ADA to rise again towards $0.295, testing the resistance of the upper range once again.
However, increased selling pressure may change the outlook. In case of a decisive break below $0.256, the structural support will weaken. In this scenario, the source stated that the price of Cardano may decrease towards $0.239, invalidating the bullish thesis in the short term and reinforcing the dominance of the downside.
