Cardano (ADA) Price: Key Support at $0.50 Tested as Investors Face Potential Losses

TLDR

• Cardano (ADA) jumped 13% on Wednesday after Trump paused some tariff implementations
• Price currently around $0.57-0.63, up from Monday lows of $0.50
• Technical indicators show bearish signals including a Death Cross (200-day EMA crossing above 50-day EMA)
• Long-term holders approaching loss territory according to MVRV metrics
• Price could potentially drop below $0.50 if current support levels fail to hold

Cardano’s price experienced a significant bounce midweek, jumping 13% on Wednesday after US President Trump announced a 90-day pause on implementing new tariffs on some countries. This news provided temporary relief for risk assets that had been under pressure.

The cryptocurrency is currently trading around $0.57-0.63, representing a 23% increase from its Monday lows of approximately $0.50.

Despite the pause on some tariffs, President Trump increased tariffs on Chinese imports to 125%, citing a “lack of respect that China has shown to the world’s markets.”

This mixed policy approach has created volatility across crypto markets, with ADA responding positively to the partial easing of trade war concerns.

The bounce may be attributed to oversold conditions earlier in the week, creating a favorable environment for short-covering and dip-buying activity.

Technical Warning Signs

Despite the recent price recovery, technical indicators paint a concerning picture for Cardano’s near-term prospects.

A Death Cross formation has appeared on ADA’s chart, with the 200-day exponential moving average (EMA) crossing above the 50-day EMA. This crossover typically signals the end of bullish momentum and often precedes further price declines.

The bearish cross marks the end of Cardano’s five-month bullish momentum, suggesting a shift in market sentiment toward a more cautious outlook.

Adding to these concerns, Cardano remains in an overall downtrend and continues to trade below all of its major moving averages.

The four-hour candlestick chart reveals a pattern of lower highs and increasingly weaker bounces since late March, reinforcing the bearish outlook.

Investor Sentiment Shifts

Market data indicates a concerning trend in investor sentiment toward Cardano.

The MVRV (Market Value to Realized Value) Long/Short Difference has dipped below the neutral line, suggesting that long-term holders are approaching loss territory.

This metric is particularly important as it shows the potential for profit-taking or loss-cutting decisions from investors who have held ADA for extended periods.

If this trend continues, long-term holder profitability could shift to short-term traders, further intensifying selling pressure on the asset.

The current lack of aggressive buying despite the recent bounce suggests limited conviction in a sustained recovery.

Critical Support Levels

Cardano is currently holding above critical support at $0.54, but market analysts warn this might not last.

A key trigger level has been identified at $0.581, with a breakdown below potentially opening the door to further losses.

Cardano Price on CoinGecko

If support at $0.50 fails to hold, technical analysts suggest ADA could enter what one describes as a “zone of emptiness” where buying pressure becomes minimal.

In this scenario, further price targets include $0.46, $0.42, and potentially even $0.40, representing significant downside from current levels.

The $0.63 area, which previously served as support, is now functioning as resistance, coinciding with the 0.5 Fibonacci retracement zone.

Market Outlook Remains Complex

The broader market environment continues to present challenges for risk assets like Cardano.

Upcoming inflation data could impact Federal Reserve policy expectations, with markets currently pricing in 100 basis points of easing by year-end according to the CME’s Fed Watch Tool.

Hot inflation reports could disappoint market expectations and hurt risk appetite across cryptocurrencies and other speculative assets.

US Treasury markets send concerning signals, with the 10-year yield having jumped 45 basis points from earlier weekly lows to around 4.30%.

With US long-dated yields remaining above 4.0%, investors may be discouraged by the lack of downside in bond yields despite recent stock market corrections.

The continued US-China trade tensions create additional uncertainty, even as relations with other nations show signs of improvement.

These complex macro factors make it difficult for investors to confidently re-enter positions in cryptocurrencies like Cardano in the near term.

Potential Catalysts to Watch

Despite the bearish outlook, there are potential developments that could impact Cardano’s trajectory.

Reports suggest Ripple and Cardano may be developing some form of collaboration, though the details and potential market impact remain unclear.

For any meaningful recovery, ADA would need to secure $0.57 as a support floor and successfully break above the $0.63 resistance level.

A shift in broader market sentiment or positive developments specific to Cardano could help avoid further losses and provide a path to recovery.

However, the initial excitement that Cardano might benefit from a pro-crypto Trump administration hasn’t materialized in any concrete way so far.

Cardano hasn’t been selected as the blockchain to run Treasury payments, and co-founder Charles Hoskinson hasn’t joined Trump’s inner circle of crypto advisors.

Yet the price remains approximately double its pre-election levels, suggesting some premium might still need to deflate.