The broader crypto market continues to suffer a huge blow as Bitcoin struggles, dropping to the $75k level. Cardano, a top 10 cryptocurrency, joined the bleed.
It dropped 6% in just 24 hours on the 2nd of February, reaching $0.267.
It then bounced back to $0.28 as ADA sought stability, raising concerns across the market. Despite the RSI being below 30, a level that had marked all bottoms below $0.30, every previous bounce had been volatile.
The fall below $0.30 marked a critical point for traders who once saw Cardano’s dip as a buying opportunity. However, has history always been kind to those who acted on such optimism during these moments?
Are Cardano bulls getting in?
On the 2nd of February, Open Interest (OI) remained elevated despite ADA’s price not rising. In fact, OI had consistently stayed high throughout Cardano’s decline.
By mid-January, ADA’s OI had surged to an impressive $840 million. However, bullish sentiment had not driven this increase.
Instead, it reflected bears positioning themselves to capitalize on the sinking price of Cardano. A reversal to $0.32 and rising OI would signal bulls taking control.
But the big question is, can they sustain momentum, or is the market too bearish for a lasting rally?
Whale orders continue to rise as Cardano falls
Whale orders on Cardano surged with each price dip, according to CryptoQuant data. Major players aggressively bought after Cardano fell below $0.80, while retail traders hesitated.
This “front-running” strategy, which has paid off before, signaled accumulation. Despite the short-term outlook, whales seemed to be betting on a Cardano recovery.
Will Cardano hold its support, or is a bigger move ahead?
Cardano’s future relied on holding the $0.267 support level, which had been key in 2024.
A strong rebound was possible if it held this level, with the next resistance levels to watch at the local resistance between $0.32 and $0.358 and resistance at $0.43, then potentially completing a double bottom pattern for a bullish reversal.
Failure to maintain this support could lead to a drop towards $0.13, depending on Bitcoin’s weakness, a worst-case scenario for ADA holders. Bulls had to defend this zone to avoid further declines.
Final Thoughts
- Cardano’s short-term direction depends heavily on its ability to maintain the critical support zone between $0.22 and $0.267.
- Whale activity and Bitcoin stability could signal a positive shift for Cardano.
