Cardano Slips as Derivatives Signal More Weakness

Key Moments

Whale Accumulation Fails to Reverse Price Slide

Cardano (ADA) continues to extend recent losses, changing hands below $0.160 on Monday after a weekly decline of more than 14%. On-chain metrics show that large-wallet investors have been actively buying into the weakness, yet this accumulation has not translated into a sustained recovery in spot prices.

Data from Santiment’s Supply Distribution metric indicates that addresses holding between 100,000 and 1 million ADA (red line), 1 million and 10 million ADA (yellow line), and 10 million and 100 million ADA (blue line) have collectively acquired 320 million ADA since July 7. This “buying the dip” activity underscores ongoing long-term interest from sizeable holders and, in isolation, would typically be interpreted as constructive. However, these inflows have not provided immediate price support.

Cardano supply distribution chart. Source: Santiment

Derivatives Metrics Turn Decisively Bearish

While on-chain accumulation by whales has been notable, derivatives data paints a more cautious picture for ADA. Futures positioning has shifted in favor of bears, with multiple indicators aligning to show weakening speculative appetite.

ADA’s futures Open Interest (OI) stands at $385 million on Monday. This level follows a steady decline from a modest uptick seen in early July and leaves OI entrenched in a broader downward trend. Falling OI alongside a dropping underlying price is typically associated with a bearish backdrop.

Cardano open interest chart. Source: Coinglass

Funding dynamics corroborate this negative bias. CoinGlass’ OI-Weighted Funding Rate for ADA turned negative on Friday and registers at -0.0028% on Monday. A negative funding rate indicates that short positions are paying longs, reflecting an expectation of further downside among leveraged traders.

Cardano funding rates chart. Source: Coinglass

Positioning data adds another layer to this risk-off tone. CoinGlass’ long-to-short ratio for ADA is at 0.79 on Monday, close to its lowest level in more than a month. With the ratio below 1, more traders hold short positions than long ones, signaling that the market is positioned for continued weakness rather than a rebound.

Technical Outlook: ADA Holds Bearish Bias Below Key EMAs

From a technical standpoint, Cardano remains under pressure. ADA trades at $0.158 on Monday, maintaining a negative near-term tone as it sits well below major Exponential Moving Averages (EMAs), which now act as layered resistance.

The 50-day EMA at $0.181, the 100-day EMA and the previously broken descending trendline region clustered near $0.211, and the 200-day EMA at $0.280 all sit overhead, reinforcing a series of dynamic barriers for any attempted recovery.

Momentum signals remain weak. The Relative Strength Index (RSI) is hovering near 42, while the Moving Average Convergence Divergence (MACD) line is drifting toward the zero line. Together, these indicators point to a lack of strong upside momentum, suggesting that rallies are more likely to encounter selling pressure than to establish a decisive bullish reversal.

Key Levels to Watch: Resistance Caps and Support Floors

On the upside, the first hurdle appears at the 23.6% Fibonacci retracement of the latest downswing around $0.173. Above that, the 50-day EMA near $0.181 is the next technical barrier, followed by the 38.2% Fibonacci retracement area around $0.195. A more substantial obstacle sits at the confluence of the 100-day EMA and the prior trendline break zone near $0.211, which forms a key cap before static resistance levels at $0.236 and $0.245. Over a broader horizon, $0.280 and $0.299 outline the upper band of the medium-term resistance zone.

On the downside, immediate support is located near the recent horizontal base at $0.150. If sellers regain control, the Fibonacci anchor around $0.138 represents a deeper structural support area and a potential level where buyers may look to reassert themselves.