Cardano (ADA) has been struggling lately. The altcoin has been stuck in a sideways trend since early August, and now it's facing several more strong bearish signals.

Let's figure out what's happening with Cardano (ADA) and what to expect from the altcoin's rate in the coming days.

The market is losing interest in Cardano

Since the beginning of August, Cardano has been trading in a horizontal channel: its lower boundary is located at $0.31, and the upper one is at $0.40. These levels also indicate support and resistance, respectively.

Movement in such a range means that the strength of sellers and buyers is approximately equal. Because of this, the altcoin does not show any pronounced dynamics, trading in a prolonged sideways trend.

This stagnation has been accompanied by a significant drop in open interest (OI) in the cryptocurrency. At the time of writing, the figure stands at $128 million, down 80% from early August. OI values ​​are now at their lowest since May 2023.

Read also: 4 Altcoins That Could Renew All-Time Highs in November

Open Interest in Cardano. Source: Santiment

Meanwhile, Cardano whales (addresses holding >0.1% of the asset's circulating supply) have been actively selling off their holdings in recent months. This is indicated by the reduction in capital flows in the large holders' segment. According to IntoTheBlock, the figure has decreased by 188+% over the past 90 days.

A prolonged sideways movement, a decline in OI, and whales leaving the market are extremely bearish signals. All this may provoke the closure of even more traders' positions in ADA; potential sell-offs will only increase the pressure on the cryptocurrency's rate.

Flow of funds from large Cardano holders. Source: IntoTheBlock

Earlier, the BIC editorial team reported that the Cardano blockchain recorded a record volume of transactions thanks to the Snek.Fun memcoin launchpad. Read all the details in our article.

ADA Forecast: Hold in Range

At the time of writing, ADA is trading at $0.3331, down about 0.8% over the past 24 hours. The altcoin is still holding just above the important support level at $0.31.

However, Cardano is at risk of losing this support in the near future. The Chaikin Money Flow (CMF) indicator shows a value of -0.01. This means that the balance of power is currently on the sellers' side. This may put additional pressure on the cryptocurrency.

If the bulls fail to defend the $0.31 mark and the ADA rate breaks through the lower boundary of the horizontal channel, the downtrend will be confirmed. In this scenario, the price may fall to $0.27.

Read also: Crypto community proposes to fire Cardano founder

Cardano Price Analysis. Source: TradingView

If demand for the cryptocurrency increases and sentiment shifts to a more bullish tone, then Cardano could test the upper boundary of the range at $0.41. A successful breakout would mark the beginning of a rally. In such a scenario, ADA would have a chance to recover to $0.54, a level that was last seen only in April.