ADA, Cardano’s native token, has reached a key level and appears to signal that if the downside momentum doesn’t continue, a massive sell-off could follow. It all began with a reciprocating tariff announcement by United States President Donald Trump on April 2, 2025.
At press time, ADA is trading near $0.65 and has remained stable, gaining only 0.60% in the past 24 hours. However, during the same period, its trading volume dropped by 30%, indicating lower participation due to potential fears of a further market decline.
However, following the tariff announcement, ADA’s price initially dropped from a key level but failed to close below it, preventing further decline. According to expert technical analysis, ADA’s daily chart has formed a bullish hammer-type candlestick pattern at the key support level of $0.65, indicating potential upside momentum.
In the meantime, if this support fails and ADA falls below the key level, closing a daily candle below the $0.615 mark, there is a strong possibility it could drop by 30% to reach the $0.45 mark in the future.
At present, the asset appears bearish and is in a strong downtrend as it trades below the 200-day Exponential Moving Average (EMA).
Despite the bearish price action, investors appear to be accumulating the token, following a “buy the dip” strategy, as reported by the on-chain analytics firm Coinglass. Data from spot inflow/outflow reveals that exchanges have witnessed a significant outflow of $2.10 million worth of ADA tokens in the past 24 hours, indicating potential accumulation.
On the other hand, traders appear to be following the current market sentiment, strongly betting on the bearish side.
Data reveals that traders are currently over-leveraged at $0.636 on the lower side and $0.662 on the upper side, having built $5.41 million and $6.15 million worth of long and short positions, respectively.
Looking at this data, it seems like the bulls are dominating and are pushing ADA to hold its key support level.
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