A comprehensive technical analysis of the price of Cardano (ADA) reveals bearish signals that could anticipate a major correction in the short term. Blockchain data, specifically the MVRV indicator, shows that the asset has entered a risk zone, setting off alarms among investors and market analysts.
The main indicator supporting this outlook is the Market Value to Realized Value (MVRV) ratio, a key metric for assessing investor sentiment. Currently, Cardano’s 30-day MVRV is in negative territory, at approximately -15%. This suggests that short-term holders are, on average, sitting on unrealized losses, which has historically increased selling pressure and preceded drops in the price of Cardano. Furthermore, data from the derivatives market reinforces this thesis, with a decrease in open interest and a considerable increase in long position liquidations.
This situation is not new, but its recurrence makes it relevant. The MVRV indicator has proven to be a reliable thermometer of market sentiment. When it falls to such low levels, it indicates that the asset is potentially undervalued, creating what some analysts call a “historic opportunity zone” for strategic purchases. However, it also reflects widespread pessimism that may take time to dissipate, so the risk of a further decline is imminent before any sustainable recovery.
For investors, the outlook demands caution. The potential drop in the price of Cardano could test critical support levels. If selling pressure intensifies, the asset could seek lower supports, located near $0.77. The market’s reaction to these levels will be decisive for the short and medium-term future of ADA. Therefore, it is recommended to closely monitor these indicators before making investment decisions.
A Nearby Bottom or the Start of a New Decline for Cardano?
Although on-chain indicators like the MVRV suggest that the price of Cardano is in a zone of possible undervaluation, they also warn of a high probability of volatility and further declines. The next step for the project will be crucial; ADA’s ability to hold its key supports against bearish pressure will define its trajectory in the coming weeks. Investors should prepare for a scenario of uncertainty before a trend reversal is confirmed.
