The technical picture points to a potential downside continuation to $0.32.
Cardano’s ADA token is down and faces a brutal supply wall near $0.40, where relentless selling pressure threatens to derail bulls’ hopes of an extended upside.
The token changed hands nearly 4% in the red on Friday, hovering around $0.38 as short-term downside risks persist for top coins. As the chart below shows, ADA traded to a daily low of $0.379.
Cardano’s price action has recently encountered a formidable supply wall around the $0.40 threshold, a level that has repeatedly acted as a barrier to upward momentum.
The 50-day exponential moving average sits at $0.41, and acts as a stubborn ceiling that has informed multiple price rejections.
Meanwhile, the Relative Strength Index (RSI) on the daily chart currently lingers below the neutral mark. In technical analysis, this highlights a potential extension towards the oversold territory with a sloping outlook.
Another indicator, the ADX, shows a reading of 19.5 and points to bearish strength.
The negative directional dominance favours sellers.
The MACD similarly shows bearish divergence under the zero line, while Bollinger Bands contract toward the lower rail. It all adds up to a token facing huge downside volatility.
The $0.40 zone is therefore just another key resistance level, but a zone of notable supply overhang.
Cryptocurrencies ended the past year largely bearish amid broader market headwinds.
This saw Bitcoin struggle to defend key levels and fall to lows of $80,000 before bouncing. BTC, however, has retreated from above $97,500, and this looks to have capped momentum for top altcoins.
QCP analysts recently noted that while the macro environment could boost bulls, volatility might remain elevated. Both Bitcoin and Ethereum thus show a risk-off outlook unless the market sees cleaner spot bids.
Vaulta is among the altcoins to falter amid this downturn, and Cardano’s on-chain metrics, like dormant supply activation, point to similar sell-off pressure.
Recent rejections from the 50-day EMA also come after prices fell sharply from above $0.82 on October 10, 2025. The moving average now sits at $0.41 and recently triggered a decline to lows of $0.37.
Currently, ADA is back at the fragile $0.38 support, and with funding rates flipping negative, shorts may have an upper hand.
This classic bearish signal signals that retail optimism is evaporating. However, the 26% decrease in daily volume betrays weak conviction, and price may probe the key supply zone again.
If ADA price doesn’t reclaim $0.40 with a volume surge, it risks a 10% breakdown that could bring multi-month support lows of $0.32.
