Cardano [ADA] continued to trade within a range. The range was nearly two months old now, and the altcoin does not show any signs of a breakout yet. Even though Bitcoin [BTC] and some altcoins saw a bullish March, Cardano was unable to replicate their gains.
A move beyond $0.245 or $0.30 is needed for Cardano to establish its next price trend.
Since the 6th of February, the altcoin market (excluding Ethereum [ETH]) has gained 7.91% in cumulative market capitalization. ADA has kept pace with an 8.47% move. Should long-term investors buy the relatively weak Cardano token near its range lows and wait for it to catch up to Bitcoin?
The Cardano opportunity explained
In a post on X, Santiment explained why Cardano was flashing bottom signals. The 365-day MVRV was at -43% and deep within a buy zone. Cardano has shed 71% in value since September 2025.
The MVRV tracks the average profit/loss that holders are at. The metric showed that the past year’s holders were facing a 43% drawdown.
The Binance funding rate was the most negative it has been since June, 2023. This high shorting level meant traders anticipated more losses. Santiment noted that this signal has been a bottom signal historically.
These short positions would provide the fuel for a short squeeze, and the subsequent price gain can capture investor attention and draw capital flows inward.
The combination of a market consensus of further losses and severe yearly holder drawdown could be the long-term bottom signal that Cardano investors are waiting for.
Profit-taking would be important during the next rally
The MVRV was at extremely low levels, but investors should remember the wider crypto bear market. A sizeable rally would likely face selling pressure as holders indulge in profit-taking and underwater investors exit at breakeven.
Investors should keep a close eye on the MVRV values across different timeframes to understand what short and long-term holders are doing.
The 3-month liquidation heatmap showed that $0.300, $0.315, $0.365, and $0.430 were the key magnetic zones that the price could be attracted to. Taking partial profits at these levels was a viable option.
To the south, another liquidity cluster lay at $0.240, just below the current range lows. A price drop below $0.235-$0.240 could invalidate the buying opportunity and assert seller dominance.
Final Summary
- The combination of heavy shorting pressure and deep drawdown for 1-year holders has historically been a market bottom signal.
- A breakout beyond $0.30, the local range highs, would confirm bullish strength.
