ADA Faces Bearish Signals Amid Declining Whale Activity and DeFi Outflow

Cardano (ADA) encounters bearish signs as whale activity and DeFi outflows decline, raising concerns among investors about its short-term price prospects.

Cardano (ADA) is currently grappling with bearish signals, as indicated by a notable drop in whale activity and a significant outflow of capital from its DeFi ecosystem. The decline in whale transactions, particularly those involving amounts exceeding $1 million in ADA, suggests a potential consolidation or further price decline for the cryptocurrency.

Analysts point out that ADA is consolidating near a crucial support level of $0.58 per token, with a failure to hold this level potentially leading to a downtrend continuation towards $0.45. Additionally, ADA daily Relative Strength Index (RSI) indicates bearish momentum and a lack of strength for recovery.

Moreover, the total value locked (TVL) in Cardano DeFi ecosystem has decreased by over 22% in the last 30 days, resulting in ADA dropping to the 17th position by TVL. This decline in TVL, coupled with ADA significantly higher market capitalization compared to its ecosystem TVL, suggests an overbought condition for the cryptocurrency in the DeFi and Web3 space.

As ADA faces these bearish signals, investors are advised to closely monitor its performance and key indicators for potential market shifts.

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