Cardano (ADA) bulls seem to be losing control amid the consolidation of the broader crypto market over the past week.
Technical indicators suggest that bullish presence in ADA spot markets is diminishing, which could lead to a potential return to an annual low of $0.50.
Strengthening bearish momentum for ADA amid declining buying pressure
The Elder-Ray index for ADA, which measures the strength of bulls relative to bears, has shown a consistent decline over the past few days, signaling a weakening of buying momentum. Data from the daily chart of ADA/USD revealed a steady decrease in the size of the histogram columns that make up this indicator, highlighting a decline in bullish strength. A gradual decrease in the size of the Elder-Ray index columns typically indicates a reduction in the gap between bullish and bearish forces. When bullish pressure weakens and bears begin to take control, the histogram columns decrease. This often serves as an early warning signal for a potential trend reversal or an increased likelihood of a price decline.
This trend indicates that ADA buyers are gradually losing control, and may be on the path to a deeper correction.
Additionally, the Chaikin Money Flow (CMF) for ADA is negative and remains below the zero line since Monday. At the time of publication, this momentum indicator, which measures the flow of money into and out of the asset, stands at -0.09. A negative CMF value like this indicates that the asset is experiencing more selling pressure than buying. This hints at the likelihood of further declines in the value of ADA in the short term.
ADA bulls are struggling to defend $0.66
Currently, ADA is trading at $0.69, above the support formed at $0.66. If bullish pressure weakens further, ADA may break this support level and fall to an annual low of $0.51. On the other hand, a resurgence of new demand for the altcoin could prevent this. If Cardano bulls increase their buying activity, the support floor at $0.66 will strengthen, pushing the price of ADA to $0.76.#Write2Earn #BinanceSquare #Binance #crypto #BinanceAlphaAlert $ADA