The recent sale of millions of ADA tokens by the Cardano whale has caused the price to drop, losing more than 20% in just 48 hours. The price is now at $0.9352 and approaching critical support. Traders are worried about increasing selling pressure and another possible downturn. In this article we will take a closer look at the impact of this whale sale Cardano stock price history.
On Thursday, January 9, 2024, a prominent crypto expert posted on X (formerly Twitter) that crypto whales have dumped as many as 70 million ADA tokens.
The post forward However, the effect of this big dump is already visible in the price of ADA, which has fallen by more than 20% since the start of sales.
At the time of writing, ADA was trading at $0.9352, down 14% in the past week. With uncertainty growing among traders, the question arises whether Cardano can turn the tide or if further losses are inevitable.
The activity of the whales has led to a sharp decline in the price of ADA, which is now approaching critical support. Strong selling pressure has reduced ADA's market capitalization to $32.87 billion, down 6.08%, reflecting the magnitude of the market's response.
In addition, the Stock-to-Flow ratio has fallen from 291.37 to 288.50, indicating declining investor confidence, while shortages and demand metrics are lower.
Stock-to-Flow Ratio ADA Source: Santiment
The derivatives market is also showing significant bearish signals. As for Binance, the funding rate fell from 0.01% to 0.0055%, reflecting a decline in bullish sentiment among traders with leveraged positions.
On the DYDX exchange, Funding Rates also fell, from 0.000334 to 0.000057, indicating a further decline in market optimism. These developments indicate that traders are adjusting their positions to reflect more volatility and downside risks.
The MVRV ratio, a measure of profitability among keepers, has fallen from 0.92 to 0.769. This shows that ADA holders are suffering more losses as the price continues to decline.
MVRV ratio. Source: Santiment
These related metrics show the effect of selling the whales, which has left traders and investors without much confidence in the performance of ADA in the near term.
Despite the bearish outlook, ADA could find support at the critical support at $0.8335, which could trigger a technical reversal. However, for this, bulls must accept the selling pressure and restore confidence.
If this support does not hold, there is a risk that ADA will fall further, which could make losses worse for investors.
Cardano level. Source: TradingView
In conclusion, Cardano's recovery is largely dependent on stopping the whaling activity and returning buyers to the market. If ADA has the necessary support, it is possible to reverse. However, with current metrics pointing to a bearish trend, a quick near-term recovery seems unlikely.
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