Cardano’s Correlation with Bitcoin Puts it at Risk: Short-Term Forecast Bullish
Cardano (ADA) has been facing a tough time in the cryptocurrency market, with a recent price crash causing a significant drop in its value. Despite a slight recovery, ADA is still struggling to regain its footing, with only 36% of holders currently making a profit.
One of the key factors contributing to ADA’s struggles is its low correlation with Bitcoin (BTC), one of the top cryptocurrencies in the market. With a correlation of just 0.14, ADA has not been able to benefit from Bitcoin’s price movements, making its recovery even more challenging.
Furthermore, on-chain analysis has revealed that whales holding large amounts of ADA have been selling off their holdings, indicating a lack of confidence in the token’s long-term potential. This has added to the downward pressure on ADA’s price, with the Relative Strength Index (RSI) indicating extreme bearish momentum.
Despite these challenges, there is still hope for ADA in the short term, with bulls potentially pushing the token towards $0.55. However, the lack of strong buying power could keep ADA’s price range-bound between $0.49 and $0.52 in the near future.
Looking ahead, factors such as Bitcoin’s halving and overall market sentiment will play a crucial role in determining ADA’s future price movements. As investors navigate through the volatile cryptocurrency market, ADA holders will need to closely monitor these developments to make informed decisions about their investments.
