Amid a downtrend in market sentiment, Cardano [ADA] is on the brink of experiencing a substantial drop in price following bearish confirmation on its daily chart.
Furthermore, the current market sentiment and the bearish actions of traders have bolstered this negative forecast.
Significant Shorting of ADA by Traders
As per data from Coinglass, traders are seizing the opportunity presented by the prevailing market sentiment by heavily favoring short positions.
Reports indicate that traders with long positions are overextended at $0.85, holding long positions valued at $4.10 million.
On the other hand, short sellers are in control, overleveraged at levels of $0.912 and $0.926, currently holding short positions worth $16.77 million.
Analysis of this data reveals that short sellers exceed traders with long positions by threefold, indicating a bearish signal.
Optimistic View from Investors
Aside from traders, long-term holders and investors perceive the current market sentiment as a chance to accumulate ADA tokens.
Information from Spot Inflow/Outflow indicates that exchanges have seen an outflow of $30 million ADA tokens in the last 48 hours, suggesting a potential accumulation phase.
Some experts view this outflow as a favorable long-term buying opportunity.
Considering these on-chain metrics collectively, it emerges that ADA shows bearish signs in the short run while maintaining a bullish outlook in the long term, explaining investors’ interest in accumulating.
Technical Analysis of Cardano and Future Price Levels
Per CryptoCrypto’s technical assessment, ADA displays bearish tendencies as it has successfully revisited the breakdown level of the ascending trendline and has started moving downwards.
Given recent price movements and past momentum, ADA could see a 15% decrease to hit $0.71 in the upcoming days.
Nonetheless, the overall market seems to be facing considerable pressure due to traders’ strong bearish stance, which might reinforce ADA’s bearish trajectory.