Cardano faces 3 key hurdles in bid to break past $0.40
Following the recent Chang hard fork, Cardano (CRYPTO:ADA) initially showed promise with a surge in active addresses and a brief price jump to $0.35.
However, the blockchain network now faces several obstacles that may prevent ADA from climbing to $0.40 in the near term.
Despite a surge to 54,800 active addresses on September 6, Cardano's momentum has weakened, with active addresses dropping to 24,900, indicating reduced user interest and engagement.
On-chain data from Santiment suggests that the initial excitement following the hard fork has not translated into sustained network activity.
This decrease in active addresses could point to further declines in ADA's price if the trend continues.
The situation is compounded by the insights from the liquidity heatmap, which identifies dense liquidity zones at specific price levels.
According to data from Coinglass, Cardano's liquidity heatmap shows dense buy and sell orders at $0.33, $0.34, and $0.35, with the $0.33 region having the highest concentration.
This implies that Cardano's price is likely to encounter significant resistance around this level, making a further rise challenging.
Additionally, the Moving Average Convergence Divergence (MACD) indicator shows a bearish divergence on ADA's daily chart.
A bearish divergence occurs when the MACD trend does not align with price movements, suggesting weakening momentum.
While ADA briefly climbed to $0.34 between August 25 and September 6, the negative MACD reading indicates a lack of buying volume to sustain an uptrend, pointing to a potential price reversal toward $0.30.
According to market analysts, ADA's price could retest the $0.35 level, but resistance is expected in that region.
If the bearish sentiment continues, ADA might drop to $0.30.
However, if bullish momentum builds up unexpectedly, Cardano could potentially climb to $0.39, but this remains uncertain in the current market environment.
At the time of writing, the Cardano (ADA) price was $0.3443.
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
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