Cardano is facing difficulties: How far will the ADA price fall when LTH liquidates?

Cardano (ADA) has recently witnessed a sharp fall, erasing the gains made at the beginning of the month. This downturn is raising significant concerns within the ADA hodler community, especially among long term hodlers (LTH), who are gradually withdrawing from the market.

Increased selling pressure, combined with fears of further losses, is posing a significant threat to the value of Cardano.

The Shift in LTH Behavior

Recently, the sudden increase in the "age consumed" index shows that LTH Cardano is actively divesting. This is the strongest increase in the past nine months, indicating a decline in confidence in the investor community. The "age consumed" index tracks the movement of coins that have not been traded for a long time, and this increase means that LTH is deciding to sell.

This can have a strong impact on the stability of Cardano. When the LTH group starts selling, it is often a sign of a change in market sentiment, which can easily further erode the confidence of other investors, especially in a market under downward pressure.

The selling action from the LTH group is not only concerning because it often has a strong impact on price movements but also because it puts serious downward pressure. When this group of investors withdraws funds, the market no longer has enough buying power to sustain the upward trend, making it difficult for Cardano to regain its recovery momentum in the near future.

Age Consumed of Cardano | Source: SantimentIn addition to the selling pressure from LTH, the weakness in investment capital is also reducing the overall momentum of Cardano. The Chaikin Money Flow (CMF) indicator, which measures the accumulation and distribution levels of the asset, is currently maintaining below 0. This indicates that the capital inflow into the market is very weak, preventing any attempts to recover the price of ADA.

The lack of new capital further makes it difficult for Cardano to recover and stabilize, even though some traders continue to sell. This loss of confidence is also clearly reflected in the overall market sentiment. With the CMF indicator still below 0, the likelihood of a price reversal in the short term is almost nonexistent, and the outlook for Cardano in the future remains quite bleak.

CMF of Cardano | Source: TradingView## ADA price needs to hold 0.6 USD

Currently, Cardano is trading around the support level of 0.6 USD after a fall of 17.6% in the past week. However, with selling pressure still increasing and weak market conditions, this altcoin is facing the risk of continuing to decline further. If the downtrend persists, the price of ADA could drop to the next important support level at 0.57 USD.

If Cardano cannot maintain the support level of 0.6 USD, selling pressure will continue to push the price down further, leading to heavier losses for investors and potentially increasing pessimism in the market. With the lack of confidence from LTH, the price of ADA will be even more vulnerable in the coming days.

! 1 Day ADA Price Chart | Source: TradingViewHowever, if it can hold and bounce from $0.6, the altcoin can still regain its growth momentum, helping ADA towards the local support level of $0.66. If selling pressure eases and investor confidence recovers, Cardano could return to $0.7, thereby weakening the bearish scenario in the future.

Taylor