Cardano (ADA) is currently trading near its weakest levels of the year, flashing clear technical warning signs that traders should not ignore. Over the past 30 days, ADA has declined by approximately 24%, with an additional 5% drop in the last 24 hours alone, pushing the price dangerously close to its yearly lows around $0.37.
What makes this decline particularly concerning is not just the magnitude of the move, but the repeated bearish structure forming on the chart. In less than two months, Cardano has now confirmed two separate bearish continuation breakdowns, reinforcing the idea that sellers remain firmly in control.
Two Consecutive Bearish Flags Signal Structural Weakness
The first breakdown took shape in early November. After forming a bearish flag through late October, ADA broke down around November 11, triggering a sharp sell-off. From the flag’s high, price declined by roughly 38%, confirming a textbook bearish continuation.
After a brief period of consolidation, Cardano failed to establish a meaningful recovery. Instead, price action repeated itself. A second bearish flag developed throughout late November and early December. On December 11, ADA broke down once again, confirming a second continuation pattern within two months.
When markets repeatedly print bearish continuation patterns without reclaiming key resistance levels, it typically reflects persistent distribution rather than emotional panic selling. This kind of structure often precedes further downside, especially when rallies remain shallow and corrective.
If the current breakdown follows a similar measured-move projection as the first, downside targets begin to cluster around the $0.25 zone, a level that is increasingly appearing on traders’ radar.
Why Extreme Weakness Could Temporarily Slow the Decline
Despite the clearly bearish structure, there are two important factors that may limit immediate downside acceleration.
1. Leverage Has Already Been Washed Out
Derivatives data suggests positioning is already heavily skewed bearish. According to liquidation metrics from Gate, long leverage has largely been flushed out, with only around $27 million in long positions remaining. In contrast, short exposure sits near $135 million, roughly five times larger.
Most long liquidation clusters are concentrated around $0.36, meaning forced selling pressure significantly decreases below that level. With fewer overleveraged longs left to liquidate, the probability of a sharp liquidation cascade diminishes.
2. Long-Term Holders Are Reducing Selling Activity
On-chain data also offers a subtle stabilizing signal. The 1-year to 2-year holder cohort, often considered higher-conviction investors, has dramatically reduced selling activity.
Data from the Spent Coin metric shows coins moved by this group dropping from 666.24 million ADA to just 2.48 million ADA since December 10—a decline of nearly 99.6%. This suggests that committed holders are stepping back from selling, even as price remains under pressure.
In simple terms, ADA’s weakness has already scared away excessive leverage and slowed long-term distribution, which can act as a temporary brake during broader market stress.
Key Cardano Price Levels to Watch
From a technical perspective, Cardano’s chart remains fragile.
$0.36 is the most critical near-term support. This level aligns closely with liquidation data and recent price reactions.
A decisive break below $0.36 opens the door toward $0.33, where interim support may appear.
Below that, the measured breakdown target near $0.25 becomes increasingly relevant.
For any meaningful bullish reset, ADA would need to reclaim $0.48. Until that level is recovered, any upside moves should be viewed as corrective rallies, not trend reversals.
Final Thoughts
Cardano is currently sitting at a technically dangerous inflection point. Two bearish breakdowns in two months define the prevailing trend, and while extreme pessimism may slow the pace of decline, it does not automatically reverse it.
Unless ADA can improve its structure and reclaim key resistance levels, the risk of a deeper move toward $0.25 remains firmly on the table.
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