The price of Cardano is trading near its weakest levels this year. The token has declined by nearly 24% over the past thirty days and about 5% over the last 24 hours, maintaining its proximity to its annual low near $0.37. What distinguishes this move is not only the magnitude of the drop but also the underlying structure behind it.
In just two months, Cardano has achieved two separate breakouts to maintain a downward trend, putting new pressures on the chart and increasing the likelihood of a deeper movement.
Two downward collapses in two months indicate structural weakness.
The first breakout occurred in early November. ADA built a bearish flag from late October, then the breakout happened around November 11. This move led to a sharp decline, with the price dropping about 38% from the pattern's peak.
After a short accumulation phase, Cardano replicated the same pattern. A second bearish flag formed from late November to early December. On December 11, ADA fell again, confirming the trend's continuity for the second time in just two months.
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When markets print repetitive patterns for continued downward trends without significant recovery, it indicates ongoing selling dominance and not a short-term panic in the market. If the current breakout follows the same logic of measured movement as the first breakout, the downside targets begin to cluster around the $0.25 area.
Why could this very weakness limit further damage?
Despite the bearish structure, two factors contribute to somewhat alleviating the downside risks.
First, it was found that the positioning of derivatives was heavily skewed towards the downside. Liquidation data from Gate showed that long leverage was extremely weak, with buy orders totaling only about $27 million, while sell orders amounted to about $135 million, which is five times more. Most liquidation clusters of long positions end around $0.36, indicating that forced selling pressure sharply decreases at this level. The number of crowded long positions reduces the likelihood of significant selling liquidations.
The behavior of long-term holders has remained stable. The one to two-year holder category, often seen as stronger conviction holders, has seen a sharp decline in spending, as evidenced by the spent coins metric, which tracks coin movements by categories.
The transferred coins from this group decreased from 666.24 million ADA to just 2.48 million ADA since December 10, a decline of nearly 99.6%. This indicates that the selling pressure from committed holders is drying up, even as the price remains weak.
Simply put, the weakness of ADA has scared leveraged trading and slowed long-term selling, which could act as a temporary brake during broader market pressures.
Key points of the article for ADA price levels to watch.
The price chart of Cardano remains fragile. $0.36 is considered the most important support in the near term. The same level was highlighted in the liquidation map shared earlier.
A clear break below opens the door to $0.33, from there, a calculated collapse target appears near $0.25 on the horizon.
For any bullish recovery, ADA must regain the $0.48 level. Without that, the rallies remain corrective and not a trend change.
Currently, Cardano is in a dangerous position.
Identify declines in two months of the trend. The weakness itself slowed the decline, but if the structure does not improve, the risk of testing $0.25 cannot be ignored.
