In a recent YouTube video, prominent cryptocurrency analyst Benjamin Cowen has issued a warning regarding Cardano (ADA), suggesting that it may be on the brink of a significant downturn. Cowen highlights that Cardano has repeatedly tested a crucial support level on its weekly chart since December 2022, indicating a potential loss of momentum among buyers.
Concerns Over Cardano’s Support Level
Cowen expresses skepticism about Cardano‘s ability to sustain its position above the $0.240 support level for an extended period. He anticipates a substantial movement in the cryptocurrency’s price before the year’s end, with a bias toward a downward trend.
Cowen attributes Cardano’s potential decline to a decrease in global net liquidity, as evidenced by a chart he presented. He suggests that ADA’s price movements closely correlate with fluctuations in global net liquidity, which is calculated based on the balance sheets of central banks worldwide.
Prospects for Cardano and Altcoins
Discussing the future outlook for Cardano and other alternative cryptocurrencies, Cowen posits that a resurgence in liquidity could pave the way for a rebound. However, he cautions that such gains are unlikely in the lead-up to a halving event, a period historically challenging for the altcoin market. Cowen underscores the pivotal role of excess liquidity in influencing Cardano’s performance.
At the time of writing, Cardano (ADA) is trading at approximately $0.247, representing a 0.34% decline in the past 24 hours.
Positive Insights from Dan Gambardello
Dan Gambardello the founder of Crypto Capital Venture, offered a more positive analysis of Cardano back in late September. He noted Cardano’s resilience among the top five cryptocurrencies, its readiness for potential bullish trends, and technological advancements, including the introduction of Alonzo smart contracts and the emergence of DeFi platforms such as Sunday Swap.
Gambardello also discussed the concept of Total Value Locked (TVL) in the cryptocurrency space, advocating for Cardano’s unique staking mechanism to be included in TVL calculations, potentially elevating its ranking. While speculating on Cardano’s market cap, he suggested that a conservative estimate could lead to a $10 ADA price, although he emphasized that this was not a prediction. Gambardello concluded by highlighting Cardano’s TVL potential to compete with or even surpass Ethereum in the future.