How Low Can ADA Drop After $263m Shock?

Cardano price plunged on Monday in line with the performance of other cryptocurrencies and the $263 million drop of its DeFi assets. So, how low can the ADA coin go in this broad-based crypto sell-off?

Cardano Price Plunges As DeFi TVL Plunges

DeFi Llama shows that the TVL in the DeFi industry has crashed to $330 million from the year-to-date high of $593 million. This drop means the network has lost about $263 million in locked assets from the highest level this year.

This decline is partly because of the ongoing Cardano price crash. It has also dropped in ADA terms, moving to a low of 413 million ADA tokens, down from this year’s high of 618 million.

Further data shows that he amount of stablecoins in the network has continued falling. It has moved to about 23 million ADA tokens, down from this year’s high of 25 million tokens.

To be clear: other blockchains have shed substantial assets as the crypto sell-off intensifies. For example, Ethereum’s TVL has dropped by over 21% in the last 30 days. Tron, BNB Chain, Base, and Arbitrum’s TVL have dropped by over 15% in the same period. 

ADA Liquidations Jumped to December Levels

The ongoing ADA price crash has also led to a big increase in liquidations. The 24-hour liquidations jumped to almost $32 million, the highest increase since December 9 last year. 

The ongoing Cardano coin plunge is mostly because of the rising fear of inflation in the US after Donald Trump launched tariffs on key trade partners like Mexico, Canada, and China. These tariffs will likely lead to higher inflation and interest rates.

ADA Price Analysis: How Low Can Cardano Go?

The daily chart shows that the Cardano price has crashed from last year’s high of $1.3282 to a low of $0.5570 on Monday. It moved below the key support level at $0.8285, its lowest level on December 30, and the neckline of the double-top pattern at $1.1645. A double-top is a popular bearish chart pattern. 

Cardano has also dived below $0.8097, its highest swing in March 2024, while the 50-day and 100-day Weighted Moving Averages (WMA) crossed each other.

Key Levels To Watch

There are signs that Cardano will continue falling in the near term, with the next target being at $0.5570, its lowest level on Monday, which is about 22% below the current level. A drop below that level will point to more downside to $0.3100, its 2024 low, which is about 55% below the current level.

Conversely, the bearish ADA price forecast will become invalid if it moves above the key resistance at $0.8285, the double-top’s neckline.

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crispus

Crispus is a seasoned Financial Analyst at CoinGape with over 12 years of experience. He focuses on Bitcoin and other altcoins, covering the intersection of news and analysis. His insights have been featured on renowned platforms such as BanklessTimes, CoinJournal, HypeIndex, SeekingAlpha, Forbes, InvestingCube, Investing.com, and MoneyTransfers.com.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.