Cardano holders not in mood to trade should read this first

ambcrypto.com:

Cardano’s native cryptocurrency ADA has been hovering within the $0.49 and $0.55 price range since the end of July. This is after a bit of recovery from its bottom a few weeks ago.

This range suggests that the bullish momentum has been limited and some price observations suggest that more downward pressure might be on the way.

ADA’s price action has been moving within a descending price channel since November last year. The cryptocurrency has kicked off this week with a retest of a descending resistance line that is part of the price channel.

ADA has already pulled back slightly in the last two days, indicating that there is significant bearish pressure after the resistance retest.

Source: TradingView

ADA would have to drop substantially from its current position in order to retest its long-term descending resistance line. However, price behavior near the recent lows in the last few weeks has already formed a short-term support pattern.

An extended bearish pullback would likely retest the short-term support near the $0.41 price range.

ADA has so far managed to stay above the $0.50 price zone. This indicates that ADA long-term holders are still holding on, anticipating more upside. This reflects the RSI which has maintained its position above the 50% level.

However, the RSI’s 14-day short-term moving average (SMA) dropped from 60.18 to 52.42 in the last two days. This reflects the increase in short-term sell pressure, especially after the resistance retest.

On the on-chain front, ADA’s active addresses increased dramatically in the last few days. This reflects the buildup of selling pressure as the price interacted with the resistance line.

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