Cardano (ADA) Braces for Potential 18% Nosedive—Analyst Sounds Alarm

ADA bulls might want to buckle up—a sharp correction could be looming. One analyst’s charts now flash warning signs of an immediate 18% drop, threatening to erase recent gains.

Key levels to watch: The $0.45 support zone is now a make-or-break battleground. Lose that, and we’re staring down a cascade toward $0.37—a gut punch for latecomers who bought the ’Ethereum killer’ hype.

Silver lining? Crypto’s favorite pastime—violent volatility—means this could just be another shakeout before the next leg up. Or, you know, proof that ’fundamentals’ are just bedtime stories for bagholders.

ADA to Bleed in the Following Days?

Cardano’s ADA performed quite well towards the end of last year, with its price surging past $1.30. Despite its brief spikes in the next several months, though, it has been on an evident downtrend since then. Currently, ADA trades at roughly $0.66 (per CoinGecko’s data), representing a 45% decrease compared to the local peak observed in December 2024.

Popular analyst Ali Martinez recently explored the asset’s performance during that period. He argued that Cardano’s native token was rejected at the top of its descending channel, which has been in play for the past half-year. That said, Martinez believes the valuation could continue to decline to $0.63 or even $0.54 “if pressure persists.”

Approximately a week ago, the X user touched upon the same pattern. Back then, ADA was worth around $0.72, and he envisioned a pump toward $0.88 in the event of a breakout above the key level of $0.74. The price, though, could not pass that important barrier. 

The Bullish Scenario

Contrary to the assumption of a nearly 20% correction in the short term, some essential factors signal a potential price resurgence. In April, whales accumulated more than 410 million tokens, which, at current rates, equals roughly $270 million. This represents a much different strategy than the selling spree witnessed in late February and mid-March.

When large investors fill their bags, it usually indicates a growing confidence in the asset’s future performance. Smaller players closely monitor those actions and might also hop on the bandwagon, distributing fresh capital into the ecosystem.

ADA’s Relative Strength Index (RSI) also signals potential good times for bulls ahead. The momentum oscillator, which measures the speed and magnitude of recent price changes, varies from 0 to 100. Readings below 30 could be interpreted as bullish, suggesting the asset has entered overbought territory and may be on the verge of a rally. The ratio currently stands just north of that mark.