The recent drop in the price of the Cardano (ADA) cryptocurrency below the $0.7 level can be attributed to profit-taking by ADA whales, according to data from the crypto analytics platform Santiment. As ADA reached a high of $0.8 on March 14, there was a noticeable reduction in whale transactions ($100,000 and above) on the network. This suggests that ADA whales began to take profits at that point and have been exiting their positions gradually since then. The impact of these large traders on the market is significant, often leading to price drops as they sell off their holdings.
Market-Wide Profit-Taking
It’s not just Cardano that has been affected by profit-taking in the crypto market. Investors have been cashing in on gains from various tokens in recent weeks, including flagship cryptocurrency Bitcoin. After reaching an all-time high of $73,750, investors decided to take profits, causing a downward correction in the price of Bitcoin. Similarly, long-term ADA holders took the opportunity to sell off some of their holdings, as indicated by the movement of dormant ADA tokens on March 20. This trend of profit-taking across the market has put downward pressure on ADA’s price.
Despite the recent wave of profit-taking, Cardano is showing signs of recovery, albeit at a slower pace. There is optimism that ADA could break the $1 resistance level in its next upward move. Crypto analyst Dan Gambardello has even predicted a potential rise to between $1.4 and $1.5 if ADA can surpass the $0.8 price range. As ADA whales are expected to return to the market with transactions exceeding $100,000, there is a possibility of an increase in ADA’s price as these investors accumulate more tokens during the current decline.
As of the time of writing, ADA is trading at approximately $0.6513, reflecting a nearly 4% decline in the past 24 hours according to CoinMarketCap data. The struggle to maintain a price above $0.7 continues for Cardano, indicating the ongoing pressure from profit-taking activities. It is crucial for investors to stay informed about market dynamics and conduct thorough research before making any investment decisions, as the crypto market remains highly volatile and unpredictable.
The drop in the price of Cardano below $0.7 can be attributed to profit-taking by ADA whales and the broader trend of investors selling off their holdings in various cryptocurrencies. As the market recovers from these activities, there is hope that ADA could surpass the $1 resistance level in the near future. However, investors should exercise caution and conduct their own research before making investment decisions in the volatile crypto market.