Cardano (ADA) Struggles to Keep Up in Market Rally – Are ADA Bulls Losing Momentum?

• Cardano (ADA) has been sluggish when it comes to catching up with the crypto rally.
• ADA is underperforming compared to BTC and ETH in the current market rally.
• Trading volumes and liquidity are lagging behind other top cryptocurrencies.

Cardano (ADA) struggles to keep pace with the crypto market rally, facing low trading volumes and liquidity issues.

ADA’s Current Market Performance

As the crypto markets continue reeling from several bullish factors that have propelled prices upward, there has been a noticeable absence: Cardano (ADA). Unlike its peers, ADA’s price charts aren’t bathed in green. The Ethereum (ETH) ETF hype, coupled with the US House voting for a landmark crypto bill, has kickstarted a mini bull run.

Analyzing ADA’s Price Trends

Analyzing ADA’s monthly price chart, we see that bulls might be currently in a phase of consolidation rather than being completely inactive. So the potential for a future bull run could still be forming. At the time of writing, ADA was trading near $0.4836, closer to the upper middle of the recent range, showing some resilience after testing lower levels earlier in the month.

If ADA maintains support above the $0.43 level and breaks past resistance around $0.60, it might confirm a bullish trend. However, a failure to hold above these support levels could see ADA retesting lower support zones of $0.4 or even $0.38.

Market Sentiment and Trading Volume

Meanwhile, AMBCrypto’s analysis of Coinglass data showed that there has been a huge decrease in ADA’s trading volume by 21.54%. Typically, this means there’s been a reduction in active trading. The long/short ratio across various platforms shows mixed sentiments. For instance, on Binance, the ratio for ADA/USDT is notably higher for longs (3.8287), indicating a bullish sentiment among top traders on this platform.

In contrast, the overall market sentiment is more balanced, showing indecisiveness among the bulls and the bears. However, the relatively stable open interest reaffirms our analysis that the bulls might currently be in a phase of reassessment rather than retreat. There has been a noticeable amount of liquidation in the past 24 hours, with the majority on the short side, which means ADA’s plunge primarily affected short sellers.

Conclusion

Further cementing our analysis is the Cardano Fear and Greed Index, which currently sits at 44%, indicating a neutral sentiment among investors. Unfortunately, social sentiment appears to be low, meaning there is reduced community engagement or negative discussions around ADA. Still, the altcoin’s market share remains stable relative to other cryptocurrencies. All in all, the ADA bulls might just be taking a rest for now.