Cardano’s price is experiencing significant selling pressure, which has led to a decline in trader participation and momentum. The cryptocurrency, known by its ticker ADA, has struggled to maintain upward movement, raising concerns among investors about its future performance. With bearish technical signals on the rise, the risk of ADA drifting back toward earlier support levels is increasing if buying interest does not return soon.
The broader cryptocurrency market is currently navigating a mixed landscape. While Bitcoin is attempting to hold onto recent gains, and Ethereum is working to maintain a position above the crucial $3,200 mark, Cardano’s price has remained largely stagnant. It has not managed to reclaim key levels seen in previous rallies, which has contributed to a sense of uncertainty among traders.
Declining Trader Engagement
In mid-2025, ADA’s price approached the $1 mark, but repeated failures to break through this threshold indicated a weakening upside momentum. The price began to decline sharply in early October 2025, although warning signs had emerged earlier, as decentralized finance (DeFi) volumes and total value locked (TVL) started decreasing well before the sell-off occurred. This divergence signaled a decline in on-chain participation, which raised concerns about the sustainability of Cardano’s price.
According to data from DeFiLlama, there has been a notable slowdown in Cardano’s on-chain activity. Active addresses have decreased significantly, dropping from over 26,000 at the beginning of October to nearly 15,000 following the latest price rejection. Concurrently, decentralized exchange (DEX) trading volume has plummeted from local highs of approximately $7.42 million to lows around $1.66 million. Despite a relatively stable TVL, the contraction in address activity and trading volume points to diminishing trader engagement, suggesting that market interest may be shifting away from ADA in the short term.
Market Dynamics and Price Action
As Cardano continues to face pressure, the broader cryptocurrency momentum remains selective. While Bitcoin and Ethereum are attempting to sustain key levels, ADA has struggled to attract consistent buying interest. Recent price action indicates a consolidation phase following a sharp rebound, but the lack of follow-through suggests that the market remains cautious.
The analysis of the four-hour chart reveals that ADA is consolidating within a descending triangle pattern, characterized by lower highs capped by a falling trendline and support holding near the $0.38–$0.39 range. The tightening of Bollinger Bands indicates an imminent volatility move. A bullish breakout above the $0.41–$0.42 region could open the door for price increases toward $0.45 and $0.48 this month. Conversely, a breakdown below $0.38 might pull the price down toward $0.35 or lower, reinforcing the prevailing bearish structure.
Currently, Cardano is not positioned to reach the $1 mark. The price remains trapped below significant resistance levels, and the lack of buying interest underscores the weakness in the market. Although ADA could experience short-term bounces, these appear more like temporary recoveries rather than signs of a robust rally. Achieving a move to $1 would require a clear trend reversal and strong market participation, neither of which is evident at this moment.
As January progresses, traders will be closely monitoring Cardano to see whether it can sustain a short-term bounce or if it will revert to its ongoing downtrend. The outcome will likely shape the sentiment around ADA and influence trading strategies in the cryptocurrency market.
