Cardano (ADA) Faces Selling Pressure Despite SEC Classifying It as Non-Security

• Cardano (ADA) continues to be impacted by heavy sell pressures, despite recent regulatory clarity from the SEC.
• The price of ADA has encountered significant struggles due to adverse market conditions and declining on-chain metrics.
• Notably, ADA was recently classified as a non-security by the SEC, yet technical indicators present a bearish outlook.

Despite regulatory clarity from the SEC, Cardano (ADA) faces bearish technical indicators and sell pressures, with a declining on-chain volume exacerbating the situation.

Increasing Sell Pressure on Cardano Price

Cardano’s price has faced consistent downward pressure, evidenced by technical indicators pointing towards increasing sell offs. The asset’s on-chain volume, which has been dwindling since March, has not been supportive of a bullish outlook, further adding to investor concerns. Within the past 24 hours, ADA reported a marginal decline of 0.6%, trading at $0.399 during U.S. market hours.

Cardano’s Technical Indicators Suggest Bearish Trends

Key technical indicators show that ADA is experiencing significant downward trends. The asset’s price is characterized by a series of lower highs and lower lows, consistently trading below both the 50-day and 200-day exponential moving averages (EMAs). The primary support level for Cardano is around $0.30, with the possibility of a significant drop if the market remains bearish. On the resistance side, immediate resistance is near $0.42, while a stronger resistance can be observed at $0.50.

Declining On-Chain Activity Hampers ADA

According to Santiment data, ADA’s on-chain volume has been on a declining trend since March. Over the last 24 hours, the on-chain volume was just over $1.5 billion, a sharp decrease from March’s $11.5 billion. The reduction in trading volume suggests a lack of buying interest at current levels, often a precursor to continued bearish trends.

Current Market Sentiment and Indicators

The Relative Strength Index (RSI) for ADA sits at 45.63, indicating a neutral yet slightly negative sentiment, it leans toward the oversold territory. This metric suggests potential for further downside movement before any significant reversal occurs. Additionally, the Chaikin Money Flow (CMF) is at -0.07, reflecting negative money flow and stronger selling pressure.

Regulatory Clarity from the SEC

Despite the negative technical outlook, ADA received good news when the U.S. Securities and Exchange Commission (SEC) clarified its stance on the asset, categorizing it as a non-security. This decision marks a reversal in its previous classification and provides some regulatory clarity that could positively influence future investor sentiment.

Conclusion

In summary, Cardano (ADA) is currently facing significant sell pressure, with crucial technical indicators suggesting a bearish trend. Despite the recent regulatory clarity classifying ADA as a non-security, the asset’s declining on-chain volume and negative market sentiments indicate further downside potential. Investors should closely monitor technical indicators and market developments to make informed decisions regarding ADA’s future prospects.