Ethena (ENA) Nosedives 7%, Will It Crash Below $0.50?

• Ethena hovers at $0.56 after shedding over 7%.
• $7.31M in liquidations sweep through the market.

The red wave across the crypto market has triggered the market cap to slip to $3.85 trillion. Downward movement dominates the charts for most tokens, including Bitcoin (BTC) and Ethereum (ETH), which currently trade at around $117.7K and $3.7K. Among the pack of altcoins, Ethena (ENA) has posted a decline of over 7.76% in the last 24 hours. 

In the early hours, ENA traded at a high range of $0.6093. With the bearish pressure taking command, the asset has plunged to a low of $0.5554. At press time, Ethena trades within the $0.5622 range, with its daily trading volume dropping by over 11.92%, reaching $933.1 million. Meanwhile, the ENA market has seen a 24-hour liquidation worth $7.31 million. 

Furthermore, the Ali chart reveals Ethena nearing a crucial support near $0.56, where the TD Sequential indicator has shown a buy signal on the four-hour timeframe. This suggests a potential short-term price bounce. If the asset can close above $0.578, it may trigger bullish momentum toward the next resistance. 

Can Ethena Break Free from the Red Zone?

Ethena’s Moving Average Convergence Divergence line is stationed below the signal line, highlighting a bearish trend. However, the MACD touching the zero line might lead to a potential shift; it could either cross above and turn bullish or likely drop back and reinforce the bearish movement.

Moreover, the Chaikin Money Flow (CMF) indicator of ENA is found at -0.10, denoting a mild selling pressure in the market. The asset is being distributed rather than accumulated—money is flowing out of the asset. Also, it may continue the downtrend if the momentum is not reversed.

Notably, the ongoing market sentiment of the asset is weak, leaning slightly towards bearish territory with the daily Relative Strength Index (RSI) at 40.15. If the value continues to decline, bearish pressure may grow. Ethena’s Bull Bear Power (BBP) reading of -0.0406 signals that bears dominate the market. If it is falling deeper, bearish strength would solidify, and the price may decline.

The downside correction of Ethena has the potential to push down the price to its support at $0.5616. If the bearish pressure strengthens, the death cross could take place, and send the asset’s price toward the $0.5609 range. Upon a reversal, ENA might find its nearest resistance at $0.5628. Holding this zone could trigger the steady upside correction and open the door for further gains at around $0.5635.

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