A plausible explanation has emerged as to why Cardano (ADA) Price fell below the psychological price level of $0.7. O cryptographic token saw a sharp correction from its monthly peak of US$0.8, recorded on March 14, and has since failed to recover that level.
Cardano whales responsible for price drop
Data in crypto analytics platform Santiment shows that the whale transaction count ($100,000 and above) on the network has decreased since March 14. This period was when Cardano reached a high of $0.8, which suggests that ADA whales started taking profits from then on and have slowly exited their positions since then.
It is known that crypto whales have a huge impact on the market, and prices often fall once these traders begin unloading their holdings. Furthermore, this wave of profit-taking is not unique to the ADA ecosystem; These last few weeks have been marked by investors making profits of different cryptographic tokens in which they have been invested.
The main cryptocurrency, Bitcoin, was also not spared. Investors decided to take profits after weeks of seeing BTC make a parabolic run on its way to a new all-time high (ATH) from $73,750. Meanwhile, long-term ADA holders also appeared to have taken advantage of the opportunity to take some profits, as data from Santiment shows that a considerable amount of inactive ADA tokens were also transacted during this period.
Specifically, March 20 was a busy day for these long-term holders, as 200 million ADA tokens (which had been dormant for a year) were moved that day.
It’s time for ADA to reach $1
Like the broader crypto market, Cardano appears to be recovering of this recent wave of profit taking, albeit at a slower pace. For its next step, there is belief that the crypto token could finally break the $1 resistance. Crypto Analyst Dan Gambardello recently predicted that ADA could rise to between $1.4 and $1.5 if it manages to break out of the $0.8 price range.
ADA Whales will likely soon return to the fold, with whale transactions exceeding $100.00 expected to increase soon. An increase in the count of these transactions would suggest that these investors are taking advantage ADA’s current decline to accumulate more crypto token. This is something that could contribute to an increase in the price of ADA, depending on how optimistic these investors are about ADA in the future.
At the time of writing, ADA is trading around $0.6513, down almost 4% in the last 24 hours, according to data from CoinMarketCap.
ADA price struggles below $0.7 | Source: ADAUSDT on Tradingview.com
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