Cardano price has crashed in the past few months, continuing a downtrend that started in December when it peaked at $1.326. ADA has dropped in the last seven consecutive days, moving to its lowest level since April 7 this year.
Cardano Price Crashes as a Risky Pattern Forms
The daily chart shows that the ADA token has been in a strong downtrend in the past few weeks. The recent plunge happened after it peaked at $0.863 on May 12.
ADA price has moved below the 50-day moving average, and is along the lower side of the Bollinger Bands. It has also moved below the oversold level of the Murrey Math Lines.
The same is happening with oscillators, with the Percentage Price Oscillator (PPO) having dropped below the zero line. Similarly, the Relative Strength Index (RSI) has moved to the oversold level of 25.
The Average Directional Index (ADX) has jumped to 23, a sign that the downtrend is gaining strength.
Most importantly, the token has formed an inverse cup-and-handle pattern, a popular continuation sign. The lower side of this pattern is at $0.519, while the upper side is at $0.863.
Therefore, the Cardano price will likely continue to fall as sellers target the key support at $0.2500, which is down by over 50% from the current level. A move above the key point at $0.75 will invalidate the bearish outlook.
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Why ADA Price Has Crashed
Cardano price has plunged for several reasons, including:
- The ongoing Trump-fueled crypto market crash.
- Falling DeFi TVL.
- Delayed Chainlink integration.
The ongoing Cardano crash occurred due to the broader crypto market crash following Donald Trump’s bombing campaign against Iran. This crisis could have unintended consequences for the crypto market, potentially pushing inflation higher. Higher inflation will make it difficult for the Federal Reserve to cut interest rates.
Cardano’s price has also plummeted after its decentralized finance (DeFi) ecosystem experienced deterioration. DeFiLlama data indicate that the total value locked (TVL) in Cardano’s ecosystem has decreased by 33% over the last 30 days, to $301 million.
Cardano’s DeFi network has been surpassed by several newer chains, a sign that its demand among users has deteriorated. Unichain’s DeFi TVL has jumped by over 91% in the last 30 days to over $1 billion, while its stablecoin supply stands at $316 million. Cardano’s stablecoin supply is just $31 million and is not growing.
The Cardano price has also plunged as Charles Hoskinson continues to lament the delayed Chainlink integration. In a statement last week, he said that, while he was close with Chainlink’s top leaders, it was unclear why the integration was taking so long to happen.
A Chainlink integration would make it easier for developers to build on its blockchain. Chainlink provides the most advanced price feeds in the crypto industry.
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