Cardano (ADA) finds itself at a pivotal moment, trading perilously close to its yearly low after a significant downturn. The cryptocurrency has shed more than 10% of its value over the past week, breaching the crucial $0.60 support level and currently hovering near $0.52. This price point represents a 52-week low, creating a stark contrast in market behavior: while retail investors appear to be capitulating, large-scale investors are accumulating substantial positions. The central question for traders is whether this signals an impending collapse below the psychologically important $0.50 mark or the beginning of a strategic accumulation phase by savvy institutional players.
Divergence in Investor Sentiment
A fascinating divergence is unfolding in the Cardano market. On-chain data from Santiment reveals that between November 7th and 10th, entities known as “whales” and “sharks”—wallets holding between 100,000 and 100 million ADA—collectively acquired a staggering 348 million tokens. This accumulation, valued at approximately $204 million, represents 0.94% of ADA’s total circulating supply.
Market analysts note this is the most significant buying activity by large holders since May. Notably, these purchases occurred during a 30% price correction from recent highs, creating a classic “smart money” pattern where institutional players build positions precisely when retail investors are surrendering.
Technical Outlook Turns Bearish
From a technical analysis perspective, Cardano’s chart structure has deteriorated significantly. The weekly chart displays a clear five-wave decline, indicating the recovery movement that began in April has conclusively ended. The horizontal support zone at $0.72 has been decisively broken and is now expected to act as resistance.
Concerning signals emerge from key momentum indicators. Both the Relative Strength Index (RSI) and the Moving Average Convergence Divergence (MACD) have turned bearish without showing any signs of bullish divergence that might suggest an imminent trend reversal. Technical analysts identify $0.50 as the next critical support level, with a breach potentially triggering further downward momentum.
Derivatives Markets Bet on Further Declines
Sentiment in the derivatives markets reinforces the bearish technical picture. The funding rate for ADA perpetual futures has dropped to negative 0.057%, indicating that traders holding short positions are paying those with long positions. This dynamic clearly shows that more market participants are betting on further price declines than on a recovery.
Should investors sell immediately? Or is it worth buying Cardano?
These negative funding rates mirror levels last seen in October when Cardano faced substantial selling pressure. Historically, such derivatives market signals have accompanied sustained downward movements across cryptocurrency markets.
Ecosystem Presents Mixed Fundamentals
The fundamental health of the Cardano ecosystem presents a nuanced picture. According to Messari, the Total Value Locked (TVL) in its decentralized finance (DeFi) sector increased by 28.7% during the third quarter of 2025, reaching levels not seen since early 2022. The Liqwid protocol specifically recorded impressive growth, with its TVL expanding by 50.8% to $101.6 million.
However, more recent data from DefiLlama shows the overall TVL has declined to $244.14 million, remaining substantially below mid-August peaks. This reduction in DeFi activity fails to provide supportive momentum for a bullish case. On a positive note, the network saw a 19.2% quarter-over-quarter increase in average daily active addresses alongside a 15.7% rise in transaction volume.
Critical Threshold Approaches
With a market capitalization of approximately $19 billion, Cardano maintains its position among the top ten cryptocurrencies, though its standing is becoming increasingly tenuous. Trading volume remains elevated at over $1.3 billion in 24 hours, indicating sustained market interest despite the prevailing downward trend.
The $0.50 level now emerges as the critical threshold to watch. Whether this price point will establish a foundation for continued institutional accumulation or trigger another wave of selling remains the central question for the days ahead. The current discrepancy between substantial whale purchasing and overwhelmingly negative market sentiment suggests a potential bottom formation process may be underway, though confirmation would only arrive with a sustained breakout above key resistance zones.
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