Recently, Cardano went through a significant update known as the Chang hardfork. This upgrade brought about several key changes to the blockchain, such as on-chain voting, Delegate Representatives, improved smart contract capabilities, and a new governance structure with cost model enhancements. Despite these advancements, Cardano has experienced a decrease in price, with ADA trading at $0.3335 at the time of writing. The daily trading volume was around $307.4 million, while the market cap stood at $11.75 billion.
The recent drop in price has led to liquidations totaling $731.46K in the past 24 hours, predominantly from long positions. This indicates significant selling pressure, as the token remains in a downward trend. Technical indicators also suggest bearish sentiment, with ADA trading near the lower boundary of its Bollinger Bands, potentially signaling an oversold condition that could result in stabilization or a minor price recovery. However, the volatile nature of the market leaves room for further declines.
The Moving Average Convergence Divergence (MACD) highlights strong selling pressure, with the MACD line positioned below the signal line, indicating a continuation of the downward trend. Additionally, the Relative Strength Index (RSI) stands at 38.56, well below the neutral threshold of 50, confirming the selling momentum without reaching oversold territory. The Aroon indicator also points towards a bearish trend, with Aroon Down at 100.00% and Aroon Up at 35.71%.
Crypto analyst Crypto Yapper has identified a multi-month Falling Broadening Wedge pattern in Cardano’s intraday losses. This pattern is characterized by two descending and diverging trendlines, suggesting lower lows and higher highs with increasing volatility over time. If ADA can break above the upper trendline of this pattern, a sharp reversal could occur, potentially driving the price higher.
While the Chang upgrade introduced significant improvements to Cardano’s blockchain infrastructure, the current market conditions indicate a bearish sentiment with selling pressure dominating. Traders and investors should closely monitor key technical indicators and patterns for potential opportunities in the market.
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