Cardano (ADA) is the tenth largest crypto asset by market cap and the price is at a pivotal point. It has been stuck above the current support for over a month with its monthly returns seeing a drop of 2.93 in the last 30 days. In the last 24 hours, it has dropped slightly by 0.09 % and is currently at $0.4539 as of writing. In the same timeframe, its trading volume has gained by a slight 1.79% to $296 million while its market cap is at $16.2 billion.

After a 50% price correction from its yearly high of $0.80, ADA found support at $0.4051 on April 13th. Since then the bulls have been defending this level, but the price has struggled to break out of the consolidation phase and give a clear buy signal. 

ADA Technical Analysis

On the 4 hour timeframe ADA is forming a bearish pennant pattern which indicates the potential for further downward momentum. If the price can break down and close below this pattern, then this move could signal a continuation of the bearish trend. However if the bulls can push the price above the pennant resistance level, a rebound towards the recent lower high of $0.50 level, filling of the huge fair value gap above the $0.5 price mark and potentially retesting the recent high of $0.80 could be possible in the near future.

Moving forward to look at the technical indicators, they also show a bearish picture. On the daily chart the 50-day, 100-day and 200-day Exponential Moving Averages are currently above the current market price which shows a bearish momentum. The daily Money Flow Index currently stands at 21 which is an oversold reading and could lead to a price rebound if buying pressure increases to push it back to a more neutral reading.

Looking at the on-chain metrics for ADA, they also add weight to the bearish thesis. According to data from Intotheblock only 34% of holders are currently making money at the current price, while 61% are in a loss position.

However looking further at santiment data there have been signs of increased whale activity. The number of transactions exceeding $100,000 has spiked since the end of May more specifically from May 30th onwards which shows that that whales may be accumulating ADA tokens.

Also the number of 24-hour active addresses has been increasing slowly since June 1st which could be an indicator of more interest from investors.

While the technicals and on-chain metrics show a bearish picture for ADA, the recent gain in momentum for whale activity and the potential for a buy signal from the oversold MFI could provide support for a potential recovery in Cardano price.