ADA Tests Critical $0.59 Support as $2.3B Liquidity Exit Weighs on Cardano Price

Quick Take

• ADA trading at $0.59 (down 3.5% in 24h)
• $2.3 billion liquidity exit over four days pressures price action
• Testing critical long-term support at lower Bollinger Band
• Following broader crypto weakness as Bitcoin declines

Market Events Driving Cardano Price Movement

The primary catalyst behind ADA’s recent decline has been a significant liquidity drain, with over $2.3 billion exiting the market over just four days. This massive outflow forced ADA price to retest long-term support levels that have held multiple times throughout 2025, creating the current technical setup at $0.59.

While some analysts maintain bullish long-term projections with targets reaching $10 during the next bull cycle, these predictions have had minimal impact on immediate price action. The market appears focused on near-term technical factors rather than speculative future targets, with traders prioritizing risk management over aspirational calls.

The absence of significant fundamental catalysts in recent days has left ADA price vulnerable to technical selling pressure and broader market sentiment shifts.

ADA Technical Analysis: Oversold Conditions Emerge

Price Action Context

ADA price currently trades below all major moving averages, with the 7-day SMA at $0.62 providing immediate resistance. The 20-day and 50-day SMAs have converged around $0.64-$0.74, creating a significant resistance zone that bulls must reclaim for any meaningful recovery.

Trading volume on Binance spot remains elevated at $38 million, suggesting continued institutional and retail interest despite the price decline. This volume profile indicates that the current support test is drawing buyer attention.

Key Technical Indicators

The RSI at 34.48 has moved into oversold territory without reaching extreme levels, suggesting potential for a relief bounce. More encouraging is the MACD histogram showing a small bullish divergence at 0.0007, indicating momentum may be shifting despite the overall bearish MACD reading of -0.0376.

The Stochastic oscillator at 3.26 sits in deeply oversold conditions, historically a zone where ADA has found short-term buying interest. Cardano technical analysis suggests these momentum indicators are aligned for a potential bounce if support holds.

Critical Price Levels for Cardano Traders

Immediate Levels (24-48 hours)

• Resistance: $0.62 (7-day SMA and recent session high)
• Support: $0.59 (current Bollinger Band lower boundary and session low)

Breakout/Breakdown Scenarios

A break below $0.59 support could trigger selling toward the $0.54 yearly low, with strong support not appearing until the $0.27 level. Conversely, reclaiming $0.62 would target the 20-day SMA at $0.64, with the $0.72 level representing the next significant resistance zone.

ADA Correlation Analysis

• Bitcoin: ADA price is following Bitcoin’s weakness, maintaining typical beta correlation during risk-off periods
• Traditional markets: Limited correlation to equity markets currently, with crypto-specific factors dominating
• Sector peers: Underperforming relative to other layer-1 protocols during the recent pullback

Trading Outlook: Cardano Near-Term Prospects

Bullish Case

A successful defense of $0.59 support combined with oversold momentum indicators could spark a relief rally toward $0.62-$0.64. Volume expansion above $50 million would confirm renewed buying interest and support higher targets.

Bearish Case

Failure to hold $0.59 opens the door to further downside, particularly if Bitcoin continues declining. The next major support at $0.54 represents the yearly low and a critical test for long-term holders.

Risk Management

Short-term traders should consider stops below $0.58 to limit downside exposure, while longer-term holders may view current levels as accumulation opportunities given the oversold technical picture. Position sizing should account for ADA’s 14-day ATR of $0.04, representing roughly 7% daily volatility.

Image source: Shutterstock