Cardano’s price wobbled below $0.29 on Tuesday as ADA continued its turbulent start to August 2023. Having withdrawn $30 million in the past week, Cardano whale investors could trigger a prolonged downtrend toward $0.25.
Despite a recent uptick in transaction volume across the network, ADA continued to slide downward since the mid-July price rally. On-chain data analysis examines if the whales booking profits have put ADA at risk of a further price slump.
Cardano Price Struggles Continue Despite Transactional Activity Spikes
Cardano has scored significant spikes in transactional activity in recent months. Product developments and exchange re-listings after the XRP victory vs. SEC have been pivotal to the rise in ADA transaction volume.
The Santiment chart below depicts how ADA Transaction Volume rose from 7.32 billion to 9.63 billion between July 1 and Aug 7.
Transaction Volume evaluates the level of economic activity on a blockchain network by tracking the daily volume of coins traded among users. Spikes in the trading volume are typically bullish.
However, as seen above, while ADA Transaction Volume increased by 32%, Cardano’s price has struggled. This negative divergence indicates that the bears largely control the market momentum.
Cardano Whales Have Withdrawn $30 Million in the First Week of August
Furthermore, on-chain data reveals that Cardano whales holding balances of 10 million to 100 million coins have been piling on bearish pressure in August. This further confirms the negative ADA price outlook.
Indicatively, the whales held 12.27 billion ADA in their cumulative wallet balances at the end of July. At the close of Aug. 7, it had declined to 12.17 billion.
This shows that they have sold off 100 million coins within the first week of August.
The Whales Wallet Balances show real-time changes in the cumulative wallet balances of whale investors. When it drops drastically within a short period, it indicates that the whales are piling on sell pressure.
At a market value of $0.29, the Cardano whale cohort identified above has withdrawn approximately $29 million over the last 7 trading days.
This could send bearish signals to other strategic retail investors and ultimately trigger a prolonged ADA price downturn if whales continue to reduce their holdings.
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ADA Price Prediction: Potential Downswing Toward $0.25
Considering the critical on-chain indicators highlighted above, ADA whale withdrawals could trigger a bearish reversal toward $0.25. However, the Cardano support area around $0.27 could prevent further price decline.
At that range, the crypto traders who have queued up buy orders worth 10.86 million ADA could trigger a rebound.
But if that buy wall weakens as predicted, Cardano price could rapidly drop toward $0.25
Still, the bulls could invalidate the bearish prediction if ADA can rebound above $0.35. However, the bears have mounted a 9.32 million ADA sell-wall around $0.32. And without significant buy pressure, ADA is unlikely to clear that resistance.
But if that resistance is broken, ADA could hit $0.35 again for the first time since mid-July.
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