Cardano’s native cryptocurrency has been among the altcoins experiencing notable price declines this past week.
Some market participants believe ADA could still undergo another short-term pullback, arguing that a final dip might be required before the token gathers momentum for a decisive recovery.
How Much Lower?
Over the last seven days, ADA has fallen by nearly 10% and is currently trading around $0.25. Its market capitalization sits just above $9 billion, placing it as the 16th-largest cryptocurrency by market value. Earlier this month Cardano ranked 14th, but it has since been overtaken by LEO Token (LEO) and Zcash (ZEC), which held steadier valuations amid recent market turbulence.
Several analysts anticipate further downside for Cardano’s token. X user Sssebi, typically bullish, suggested ADA could drop more if Bitcoin (BTC) follows suit.
“Considering that ADA got rejected exactly at the upper trendline of the descending channel, we can assume that it will also retest the bottom of the channel around $0.22,” they stated.
The analyst added that this move could represent “the last dip before pump,” implying a potential buying opportunity if the pattern plays out.
Alpha Crypto Signal also commented on ADA’s price action, noting that the recent rejection at the neckline signals that sellers remain in control. Their view is that losing the $0.25 support region could open the door to “another leg down with increased bearish momentum.” Conversely, reclaiming that area would invalidate the bearish pattern and shift the advantage to buyers.
The Bullish Signals
Not all indicators are negative. Popular analyst Ali Martinez previously highlighted the importance of the $0.25 support zone for ADA, pointing out that the token experienced an 88% rally after holding that level in early 2023. He also noted that when the price held the same support in September of that year, it later surged about 243%.
Several on-chain factors are worth watching as potential bullish signals, including large-holder activity and token balances on centralized exchanges. Analytics provider Santiment recently reported that wallets holding at least one million ADA have increased their combined holdings to approximately 25.09 billion ADA, which represents over 67% of the circulating supply.
This concentration suggests strong conviction among large holders and raises the question of whether these investors see value that others may not. Their accumulation can influence market sentiment and potentially encourage smaller investors to add positions, injecting fresh capital into the Cardano ecosystem.
Exchange netflow dynamics also offer insight into supply-side pressure. In recent days outflows from exchanges have outpaced inflows, indicating that more ADA is moving off centralized platforms and into private custody. This shift typically reduces the immediate availability of tokens for sale and can help limit short-term downward pressure.
Overall, Cardano’s short-term outlook remains mixed. Technical analysts warn that a break below $0.25 could lead to further losses, potentially testing lower support near $0.22. At the same time, on-chain indicators such as large-holder accumulation and persistent exchange outflows hint at underlying demand that could support a recovery if market conditions stabilize. Traders and investors should monitor Bitcoin’s direction, validator and whale activity, and exchange netflows to gauge whether ADA’s current pullback will extend or mark the setup for a stronger rebound.