Cardano Price Prediction as ADA Drops Towards $0.52 – Time to Buy the Dip?
The Cardano (ADA) price is eyeing a possible drop below $0.52 as short-term price predictions turn bearish, but long-term bulls are nonetheless asking whether now is time to buy the dip.
Nearly all cryptocurrencies in the top 20 by market capitalization are trading with losses on Wednesday.
The Cardano price was last at $0.0525, down nearly 2% on the session.
ADA rejected a retest of its 50DMA at $0.55 on Tuesday.
While the Cardano price is still around 13% up versus last week’s lows, its over 20% down from December highs.
Market sentiment is fragile as traders continue to fret about the potential continuation of a “sell-the-fact” reaction to last week’s spot Bitcoin ETF approvals in the USA, and also as the macro backdrop turns into a minor headwind.
The US Dollar Index (DXY) and US bond yields have been pushing higher this year, generally a negative for crypto.
Recently released US data (inflation and retail sales) showed the US economy ended 2023 on a hotter-than-expected note.
And that is pushing back against bets that the Fed will cut interest rates as soon as March.
As per the CME’s Fed Watch Tool, money market implied odds of a 25 bps rate cut from the Fed in March were last around 55.7%, down from around 65% one week ago.
Multiple Fed policymakers have noted that March is probably too early for a rate cut.
Citigroup sees a first Fed rate cut in June.
Macro risks thus seem tilted towards a continued pricing out of a March rate cut.
That could continue supporting the US dollar, US yields and weighing on crypto in the short term.
Macro headwinds suggest risk of more downside for the Cardano price in the near term.
And chart analysis very much conforms to this view.
The Cardano price broke its mid to late-December uptrend in 2024
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