Cardano Faces Pressure as Whales Acquire 210 Million ADA: What's Next?

Cardano (ADA) has been under pressure despite whales purchasing over 210 million tokens over the past three weeks. Accumulation occurred while ADA traded below $0.40, suggesting this is a positioning strategy rather than a reaction to market changes. With prices situated near key support levels, consolidation and the potential for future breakout loom.

Key Takeaways

Whales have accumulated over 210 million ADA tokens as prices linger below $0.40.
Cardano trades within a multi-month descending channel, showing reduced volatility.
While buyers maintain marginal control, trend strength remains weak.
Binance's top traders show significant long positions, aligning confidence in ADA's market potential.
Funding pressures have eased for short positions, indicating a shift in market sentiment.

Cardano under pressure as whales buy 210 mln ADA: Breakout or fake out, what's ahead?

Cardano Coiling Near a Critical Level

As of now, Cardano is trading within a long-term descending channel, hovering around the lower boundary between $0.38 and $0.39. During this time, the price has defended this level repeatedly without forming lower lows, indicating less aggressiveness from sellers. However, buyers have not yet pushed for a breakout.

Market volatility has decreased with candles compressing near the channel's support. Typically, when markets compress, they are unlikely to remain stagnant for long. Typically, they resolve through a movement, with key resistance levels identified around $0.47 and $0.60. Until ADA exits this channel, the price direction is uncertain, but the current position suggests a possibility of upward movement rather than further decline.

Cardano price action

Source: TradingView

The Directional Movement Index indicates that the positive directional indicator (+DI) is at 22.66, surpassing the negative directional indicator (–DI) at 21.17, which provides a slight advantage to buyers. However, the Average Directional Index (ADX) remains low at 17.44, signifying weak trend strength. This scenario typically appears during periods of market basing, where sellers are losing dominance, yet buyers lack sufficient strength. Price tends to drift rather than trend firmly. A rise in the ADX above 25 could indicate a strong trend movement might soon follow. Until then, the current data suggests stabilization rather than a definitive upward trend.

Major Traders Favor Long Positions on Binance

Analytics from top trader accounts on Binance reveal a distinct directional bias, with 72.52% of accounts having long positions compared to only 27.48% holding short positions. This disparity highlights the confidence among seasoned traders, reflecting a sentiment more than a concentration of risk.

Top traders often position themselves early, predicting structural changes instead of solely reacting to price movements. However, the current long bias suggests a sensitivity to volatility. If the price fails to rise, traders may quickly decrease their exposure. Conversely, continued upwards movement could reinforce trader confidence, indicating that this sentiment aligns with recent accumulation rather than contradicting the current price structure.

Binance trading sentiment

Source: CoinGlass

Easing Funding Pressure as Shorts Withdraw

The Open Interest-Weighted Funding Rate has bounced back to +0.0018%, reversing from a lengthy period in the negative. This positive change indicates that bearish pressures are significantly easing, with traders no longer incurring premiums for maintaining short positions.

With funding remaining at moderate levels, the situation appears balanced rather than overly aggressive. Long positions aren't dominating funding costs, while short positions are losing their incentive. Usually, this type of environment supports market stabilization rather than abrupt reversals. A gradual recovery in funding often leads markets out of defensive phases, but funding alone cannot drive price movements without support from spot demand and market structure.

Funding rate dynamics

Source: CoinGlass

In summary, Cardano is showing signs of early stabilization, evidenced by whale accumulation of 210 million tokens, a price holding steady around $0.38, and easing derivative pressures. However, the descending channel constrains momentum, and while buyers are in a position of slight control, trend strength remains weak. A clear breakout above the channel resistance is necessary for confirming an upward trend. Until then, market conditions favor caution over aggressive trading strategies, as the evolving structure will dictate whether this accumulation turns into a sustained upward movement.

Key Takeaways

Cardano Coiling Near a Critical Level

Major Traders Favor Long Positions on Binance

Easing Funding Pressure as Shorts Withdraw

Final Thoughts