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Cardano (ADA) has lost a key support level as the broader crypto market experiences heavy selling pressure.
Cryptocurrencies had a major sell-off in early Friday's trading session, extending a painful week that included a market crash on Monday, which wiped out $1.5 billion in liquidations.
According to CoinGlass data, over $952 million in crypto holdings were liquidated during Friday's sell-off, with Bitcoin, Ethereum and nearly all of the top 100 cryptocurrencies, except stablecoins, in the red.
Vladislav SopovAt the time of writing, Cardano was reeling in losses, down 10% in the last 24 hours to $0.607 and down 25% weekly. ADA has declined since the week's start and is on track to mark five out of six days in red.
This drop has caused ADA to slip below crucial support, sparking concerns on the market. Cardano (ADA) broke below the 200-day Simple Moving Average (SMA), currently at $0.661, for the first time in this bull cycle, indicating a significant shift in its price trend amid this week's broad market sell-off. Cardano has stayed above the daily SMA 200 since early November 2024, reaching a high of $1.32 on Dec. 4.
Potential rebound ahead?
The daily RSI indicator has dropped below 30, indicating that Cardano might be oversold and may be due for a relief rally shortly.
Tomiwabold OlajideIn the event of a rebound, Cardano might attempt to reclaim the 200-day SMA as support. This might spark renewed bullish momentum if successful, while failure to do so could result in further declines. In the latter, Cardano might aim for $1, while further decreases may target $0.50.
That said, Cardano's price action might depend on broader market sentiment in the short term. If Bitcoin regains momentum, ADA could follow suit.
However, the market will watch ADA’s price action and key technical levels for signs of a potential reversal. For now, ADA holders remain cautious but hopeful that the worst of the sell-off may soon be over.
Dan Burgin
Vladislav Sopov