Has Cardano's rebound ended...Why did it collapse again?

▲ Cardano (ADA)/ChatGPT generated image ©

Cardano (ADA) saw its upward momentum stall with the re-emergence of Middle East risks, putting it at risk of giving back its weekly rebound gains.

According to FXStreet, an investment media outlet, on April 8 (local time), Cardano continued its downtrend, trading below $0.25 after a 4% decline the previous day. The short-term upward trend, which had been formed by expectations of a US-Iran ceasefire, weakened, causing overall market investor sentiment to waver again.

Particularly in the derivatives market, the liquidation of bullish positions intensified, signaling a clear bearish reversal. Over the last 24 hours, a total of $602,370 in liquidations occurred in the Cardano derivatives market, with $544,540 of that being long positions. This indicates that a large number of investors who bet on an upward trend have exited the market.

Along with this, open interest also decreased rapidly. Cardano futures open interest decreased by approximately 8%, shrinking to about $407.49 million. The funding rate also fell to -0.0045%, indicating that market participants are increasingly leaning towards bearish bets.

Technically, a bearish structure continues. Cardano remains below its 50-day exponential moving average of $0.2673, as well as its 100-day and 200-day moving averages, indicating strong overhead resistance. The Moving Average Convergence Divergence (MACD) shows only limited bullish signals, and the Relative Strength Index (RSI) is at 46, maintaining bearish momentum below the neutral line.

On the downside, $0.2328 acts as the primary support level, and if this level breaks, there is potential for further decline to $0.2205. Conversely, for an upward reversal, Cardano needs to reclaim $0.2673, after which the $0.2991 and $0.3107 ranges are presented as the next resistance levels.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*