Cardano Price Prediction: ADA Pares 2% – Bearish Cycle on the Horizon?

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Cardano (ADA) is at an inflection point as bulls and bears fight for control daily. When writing, the Layer 1 token exchanged hands at $0.26, practically unchanged over the last 24 hours with 0.26% gains.

The price remained bearish on the longer timeframes, trading 8% down on the week and 18% below its price over 30 days ago. ADA had also dropped 32% over the last six months and 44% over the previous year. Several fundamentals and on-chain data suggested that Cardano’s bearish cycle may continue.

Decreasing Total Value Locked on Cardano

The total value locked (TVL) on the Cardano blockchain has been dropping over the last month. According to data from DeFiLlama, Cardano’s TVL has fallen by 23% from $209.16 on July 13 million to its current value of $161.03 million.

Recent data from Nansen showed that Base overtook Cardano’s TVL on August 22. The on-chain analytics platform posted the following chart on X, formerly Twitter, placing Cardano’s TVL behind Base’s by about $1 million.

It didn't take long for Base to overtake Cardano's TVL

Maybe they should pivot into becoming an ETH L2… pic.twitter.com/8Ma2vhqQaT

— Nansen 🧭 (@nansen_ai) August 22, 2023

At press time, the $161.03 million value of assets on Cardano ranked behind those locked on Coinbase’s Base network, which had a TVL of $190.35 million, according to data from DefiLlama.

In the longer timeframe, Cardano’s TVL has significantly dropped over the last 12 months. Hitting a high of $434 million on March 28, 2022, Cardano has since shed over 50% of its TVL. This drop is attributable to the severe bearish conditions that marked the 2022 trading year that began with the implosion of the Terra Ecosystem in May and later the collapse of Sam Bankman-Fried’s FTX crypto exchange in November.

Decreasing User Activity

On-chain data also reveals that user activity on Cardano has declined over the last month. While its TVL has fallen 23% during that period, user activity on the chain has also trended downwards.

This is validated by the Daily Active Addresses (DAA) metric from Artemis, an institutional data platform for crypto assets. According to the Artemis data, there has been a steady drop in the daily count of unique wallet addresses that have completed on-chain transactions on the Charles Hankinson-led blockchain in the last 30 days. Cardano’s DAA declined by more than 44% between July 23 and August 21.

Source: DeFiLlama — **Source**: *Artemis*

With fewer DAAs on Cardano in the last 30 days, the number of daily transactions has also been reducing on the platform. The Artemis chart below reveals that the total number of daily transactions recorded on the network fell by 32% between July 23 and August 21.

Cardano Daily Transactions — **Source**: *Artemis*

They are decreasing Daily Active Addresses and Daily Transactions signal reduced network usage. Both on-chain metrics tend to be directly correlated to price activity. Therefore, as they continue declining, they may lead the price to follow the same trajectory.

Cardano Price Analysis – Can ADA Reverse Bearish Trend?

ADA price is fighting to stay within the confines of a V-shaped recovery chart pattern to avoid further losses. The 50-day SMA is providing immediate support at $0.259. A daily candlestick close below this level would see Carnado drop first toward the $0.255 psychological level and revisit the $0.250 swing low, coinciding with the V-shaped chart pattern’s tip. This would bring the total losses to 4%.

ADA/USD Daily Chart

Cardano Price Chart - August 23 — TradingView Chart: ADA/USD

Supporting this grim outlook for ADA was the position of the Moving Average Convergence Divergence (MACD) indicator within the negative region. The Relative Strength Index (RSI) was also positioned below the midline. This suggested that the market conditions favored the downside.

On the upside, bulls could push the price to confront resistance from the 100-day SMA at $0.265. Overcoming this barrier would bring the 200-day SMA at $0.268 and the governing chart pattern’s neckline $0.273. This would get the total gains to 5%.

From the on-chain and technical analysis above, it is evident that Cardano may be entering its bearish cycle. Given the current macroeconomic uncertainties and the high volatility nature of the crypto market, it is not known how long things might take.

Therefore, investors are advised to look into new cryptocurrency in presale with the potential to make good returns in 2023. One of them is yPredict, which is discussed next.

ADA Alternatives

yPredict ($YPRED) is a new AI crypto project presenting an AI-powered asset analytics firm operating within the Web3 domain. yPredict caters to traders and investors by equipping them with analytical tools and data-fueled insights across various assets.

These data-driven insights empower newcomers to the crypto space to make well-informed trading decisions and extract optimal gains from the cryptocurrency market.

Excited to share our latest article delving into Ethereum price prediction using the ARIMA model! 📊🚀 Discover how we harness the power of ARIMA's statistical insights to navigate the dynamic world of cryptocurrency forecasting. Uncover the patterns, analyze the trends, and gain… pic.twitter.com/c02q3DVw21

— yPredict.ai (@yPredict_ai) August 18, 2023

The project’s presale performance has attracted considerable attention from numerous investors, with the presale achieving an impressive milestone of $3.5 million, indicating a notable surge in the token’s adoption.

The team behind yPredict is driven by the mission to address humans’ challenges in predicting financial markets. They do this by offering AI predictive analysis and a suite of metrics designed to support users in their pursuit of success.

Financial quants, AI and Machine Learning experts, and traders can offer their predictive models as subscriptions, creating a passive income stream for these specialists within the financial sector.

A noteworthy aspect of yPredict is its commitment to distributing 10% of every new subscription on its platform to users who stake $YPRED in the project’s staking pool. Furthermore, users who engage in token staking can earn between 5 and 10% APY as rewards.

The platform’s utility instrument, the $YPRED token, affords users discounts on model prediction subscriptions and access to premium offerings within the yPredict ecosystem.

Visit yPredict here for more information on how to participate in the ongoing presale.