Cardano (ADA) continues to traverse murky waters, as evidenced by its consistent downward trend, which is evidenced by lower highs and lower lows.
ADA’s bearish momentum is illustrated by the ninth-largest cryptocurrency trading below all major exponential moving averages (EMAs).
Furthermore, the Moving Average Convergence Divergence (MACD) and Relative Strength Index (RSI) are now showing any signs of a bullish divergence.
Bullish divergence shows that even though an asset’s price is dropping, downward momentum is declining, illustrating a potential reversal to an uptrend.
This usually happens when an asset makes lower lows, but technical indicators, such as RSI and MACD, are making higher lows.
Therefore, bears have taken the driver’s seat in the Cardano network based on these on-chain metrics.
Is there Light at the End of Cardano’s Tunnel?
Cardano will need to shatter major resistance at the $0.66, $0.68, and $0.70 zones to increase its chances for a bullish reversal.
Renowned market analyst Ali Martinez pointed out, “Cardano was rejected at the top of its descending channel ($0.66), potentially setting up a move toward $0.63, or even $0.54 if pressure persists.”
ADA was down by 8.4% in the past week to hit $0.65 at the time of writing, according to CoinGecko data.
Nevertheless, all hope has not been lost since whales scooped up more than 410 million ADA tokens last month, which might suggest that this was calm before the storm because they expected bullish momentum to build up in the short term.
