Cardano price appears to have triggered massive sell positions after it failed to rise above resistance at $0.4400. The smart contract platform bowed to increasing overhead pressure as investors locked in profits. ADA must reclaim immediate support at $0.4000; otherwise, its leg may stretch to $0.3730 before bulls get another chance to push prices higher again.
Cardano Price Trading Volume Explodes Ahead of The Fed’s Interest Rate decision
The US Fed (Federal Reserve) will announce the much-awaited interest rate decision on Wednesday, 6 PM UTC. Market participants are waiting with bated breaths to see whether the regulator will continue the interest rate hike streak that has lasted for months this year amid calls to control inflation.
A 0.75% increase in interest rates would mean tougher times ahead, with investors likely staying clear of riskier assets like cryptos. Although, the markets have become more resilient in recent months, perhaps indicating the worst is behind us already.
Cardano Price Prediction
Technical insights from the eight-hour timeframe chart reveal that sellers have the reins, at least for now.
The outlook for Cardano flipped bearish immediately after the price bounced off resistance at $0.4400 – an area reinforced by the 200-day EMA (Exponential Moving Average) (in purple).
A rising wedge pattern worsened the situation for the bulls, who seem to be waiting for a lower price level. A break below the lower trend line of the pattern confirms the bearish move, and ADA seems to be heading back down toward support around $0.37.
ADA now trades below the 100-day EMA (in blue) and the 50-day EMA (in red). A 9.06% move to $0.3730 is anticipated below the breakout point.
Looking at other indicators like the MACD (Moving Average Convergence Divergence) and the RSI (Relative Strength Index), Cardano’s price will likely remain bearish in the upcoming sessions, especially on Wednesday.
The MACD confirmed a sell signal on Monday as the 12-day EMA (in blue) crossed below the 26-day EMA (in red). As observed, both lines are trending toward the mean line and indicate rising selling pressure.
Similarly, the RSI affirms the bears’ tight grip with its negative divergence from the price. The index’s movement below the midline implies that sellers have the upper hand.
Key Fundamental Influencing Cardano Price Retracement
Most ADA addresses have been profitable since October 25, when the MVRV (Market Value realized Value) climbed above 1, as seen in the chart below. This metric from Santiment tracks the profit or loss of ADA holders by comparing the price at which the tokens last moved and their current market value.
An MVRV ratio above 1 suggests that most holders are realizing profits and are likely to sell, which explains the Cardano price pullback as soon as the index topped 8.8 on October 29. The MVRV holds at 3.65 at the time of writing which hints at the bearish leg extending further down.
A section of Cardano whales are still not convinced that Cardano is ready to change its course to the upside in light of the 2022 bear market. The number of addresses with between 100,000 and 1,000,000 ADA tokens is now down to 20,600 after dropping from a 30-day peak of 20,777. Despite the bulls’ effort to push Cardano’s price higher, this cohort’s selling spree may suppress price action to the upside.
Cardano’s price has hit a stumbling block and is inclined to retreat before it can attempt another move up again.
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