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Cardano (ADA) Is Bearish, Suggest Majority of On-Chain Indicators

Sun, 05/14/2023 - 12:20
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Arman Shirinyan
As crypto market remains turbulent, Cardano is exhibiting bearish signals, with four key on-chain indicators suggesting downward trend
Cardano (ADA) Is Bearish, Suggest Majority of On-Chain Indicators
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While the world of crypto remains in flux, one altcoin that has been receiving mixed sentiments in recent times is Cardano (ADA). A majority of on-chain indicators suggest a bearish trend for ADA, despite a bullish signal from the Bid-Ask Volume Imbalance indicator.

According to data from IntoTheBlock, four key indicators paint a rather grim picture for ADA. These include the Concentration indicator, In the Money indicator, Net Network Growth indicator and Large Transactions indicator. When the concentration of ADA by large holders (known as "whales") decreases, it often implies a bearish trend as large holders sell off their holdings.

Similarly, when the In the Money indicator drops, it means a decreasing number of ADA addresses are profiting from their positions, suggesting a bearish sentiment.

Source: TradingVIew

The Net Network Growth indicator, which tracks the growth of new ADA addresses, has also been trending downward, indicating a decline in network growth and potential bearishness. Additionally, a decrease in the number of large transactions often implies a lack of interest from institutional investors, again hinting at a bearish trend.

However, ADA's Bid-Ask Volume Imbalance remains bullish, indicating that there may still be strong buying pressure. This indicator measures the difference between the volume of ADA on the buying side and the selling side of the order book. When this imbalance is positive, it suggests that there is a higher demand to buy ADA than sell, potentially driving up the price.

No, Cardano (ADA) Hydra Cannot Handle 1 Million TPS, Developer Says

Despite this bullish indicator, Cardano's recent price performance tells a similar story to the bearish on-chain indicators. TradingView data shows that ADA's price has decreased by 7.30% over the past week and 9.68% over the past month. The current market capitalization stands at $12.75 billion with a 24-hour trading volume of $194 million​​.

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About the author

Arman Shirinyan is a trader, crypto enthusiast and SMM expert with more than four years of experience.

Arman strongly believes that cryptocurrencies and the blockchain will be of constant use in the future. Currently, he focuses on news, articles with deep analysis of crypto projects and technical analysis of cryptocurrency trading pairs.