- Cardano (ADA) dropped to $0.25 as geopolitical tensions between the US and Iran weighed on crypto markets.
- Weak trader participation and bearish derivatives data suggest a possible deeper correction ahead.
Cardano (ADA) is showing signs of weakness, trading near a critical support level after last week’s 7% drop. Traders are cautious as escalating tensions in the Middle East continue to weigh on risk appetite, hinting at a possible deeper correction for ADA.
Geopolitical Risks Pressure Risk Assets
Crypto markets opened the week cautiously following threats from former US President Donald Trump to target Iran’s power grid. In response, Iran warned it would strike the energy and water systems of its Gulf neighbors if attacked.
These tensions have pressured risk assets, with Bitcoin falling below $67,360 and triggering liquidations across the crypto sector. Cardano mirrored this move, closing near $0.25 and showing cautious trading on Monday.
Cardano Traders Show Waning Participation
Derivatives data indicate declining confidence among Cardano traders. Open interest in ADA futures dropped to $388.23 million on Monday, continuing a decline since mid-March.
Funding rates also signal bearish sentiment. CoinGlass data shows a negative funding rate of -0.019%, suggesting that traders are paying longs to hold positions, which points to a prevailing bearish outlook.
ADA Bears Remain in Control
Cardano is trading below key moving averages, with the 50-day EMA at $0.28 and the 100-day EMA at $0.33. This keeps the broader downtrend intact after the failure to sustain levels above $0.29.
The RSI sits at 41, indicating ongoing selling pressure, while the MACD remains below the signal line, confirming fading upside strength.
Immediate resistance is observed at $0.27, with stronger barriers near $0.30. A close above $0.30 could ease bearish pressure and open the way to $0.32. On the downside, support lies at $0.24, with a major floor at $0.22. A break below $0.22 would signal a continuation of the broader decline.
Outlook for Cardano
The near-term bias for ADA is mildly bearish as geopolitical tensions and weakening trader participation weigh heavily on sentiment. Investors will likely watch $0.25 and $0.22 closely, as these levels could determine the next significant move for Cardano.
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