Amid the broader crypto market correction, Cardano (ADA) has faced yet another bearish hit, with its price struggling alongside Bitcoin’s fall below the $54,000 mark. With a market-wide decline, including Cardano’s drop, the crypto market stands at $1.908 trillion, and liquidations have surged to nearly $100 million. The key question now is: can Cardano survive the bear run in September and set the stage for a bullish restart?
Intense Bearish Pressure on Cardano’s Price Channel
On the daily chart, Cardano is stuck in a falling channel pattern, which began from its 52-week high of $0.810. Since then, ADA’s price has dropped by 59.72%, reaching its current level of $0.325. However, Cardano has recently found strong support at $0.32 and is hinting at a potential double-bottom reversal.
The falling channel pattern is characterized by a resistance trendline that has triggered four bearish cycles so far. Meanwhile, the support trendline has led to multiple bullish cycles of similar intensity. Adding to this, the daily RSI line shows a bullish divergence, with the RSI currently at 39.19, up from the previous low of 26.20 in the oversold zone, indicating a potential reversal.
Cardano Network Activity Drops Sharply
The Cardano network has seen a significant reduction in activity this year. At the start of 2024, the network processed over 95,000 daily transactions. Now, this number has dropped to approximately 33,000 transactions, a decline of nearly two-thirds. The transaction volume on the Cardano network has also fallen, from 29.21 billion ADA tokens to 14.4 billion ADA tokens.
Source: Trading View
This decline in network health has undoubtedly impacted the price of ADA. However, optimism remains, as the recent release of the CIP-1964 upgrade, which aims to decentralize the network further, could boost ADA’s price in the next bull run.
Will Cardano Hold the $0.30 Support?
Cardano’s potential bullish recovery faces resistance at the 50-day EMA at $0.361, the overhead trendline at $0.364, and the 200-day EMA at $0.425. On the downside, the $0.32 support level could drop to the psychological $0.30 mark or even further to $0.276.
Despite potential hurdles in September, a bullish breakout from the falling channel could occur in October, which might push Cardano’s price towards the 50% Fibonacci mark at $0.544.
