- Almost all ADA transactions have been loss-making since April 22.
- The entries for the cryptocurrencies were between $0.40 and $0.44.
Almost all Cardano this week [ADA] trades led to participants realizing losses, AMBCrypto confirmed. Before this conclusion, we looked at the profit/loss achieved by the network.
This metric measures the USD value of transactions in profit or otherwise within a specific period. Our analysis shows that the last time ADA gave participants a significant amount of money was on April 22. At that time, the $19.78 million token did not need to be sold at a loss.
But at the time of writing, those were already ADA tokens, worth $321,000 realized losses in the past month. This action mirrored the cryptocurrency’s price action.
Source: Santiment
No money for the time being
Five days ago, Cardano’s price was $0.52. At the time of writing, that value had fallen to $0.46, indicating that it was challenging to make a profit outside of spot trading the token.
However, short-term holders aren’t the only ones affected by the ADA move. A few weeks ago, less than 50% of holders were making losses. According to press time data from IntoTheBlock59% of the total number of holders were left without money.
On the broader spectrum, this could indicate a buying opportunity, as many holders may not want to liquidate their holdings without some gain.
If this is the case, more accumulation could occur, giving Cardano a potential advantage. On the other hand, if some of the holders decide to forfeit what was left, ADA’s price could drop to $0.44.
Source: IntoTheBlock
But is this a good time to consider buying ADA? Well, AMBCrypto’s analysis of the price-DAA divergence gives some idea of that. For the unfamiliar: DAA is an acronym for Daily Active Addresses. It shows the daily level of user activity on a blockchain.
Signal screams: prepare for a new exit!
Using Santiment’s data, we determined that the price DAA divergence amounted to -49.99%. This benchmark allows traders to develop a trading strategy that is historically proven to be valid.
If the price rises more than the DAA in previous cycles, it means it’s time to buy. On the other hand, a strong exit sign appears if the price falls more than the DAA.
One thing we noticed was that Cardano’s DAA jumped in recent days, while ADA’s price fell. Therefore, one can conclude that a solid buying opportunity has not yet emerged.
Source: Santiment
Price-wise, ADA could fall below $0.45 psychological support in the near term. Should this be the case, market participants may need to find other entry points between $0.40 and $0.44.
Is your portfolio green? View the Cardano Profit Calculator
Despite the potential setback, Cardano’s medium-term recovery may still be possible. But that would depend on altcoin performance.
Should cryptocurrency prices rise around the same time period, the ADA could rise and break $0.60 once more.