Triple Warning Signal in Cardano: $0.170 and $0.144 Levels on the Horizon for ADA

Santiment highlighted a potential correction risk for Cardano (ADA), noting that whale movements, MVRV data, and a technical indicator are issuing warning signals simultaneously.

According to the analysis shared by Santiment Intelligence, the number of whales holding between 1 million and 10 million ADA has dropped from 2,370 to 2,340 since August 2. This decline suggests that some large investors may have taken profits or redistributed their holdings following the recent price increase.

Alongside the decline in whale count, a death cross has formed between Cardano’s MVRV ratio and its 7-day simple moving average (SMA). MVRV is used as a metric that compares an asset’s market value to investors’ cost basis. This crossover indicates weakening momentum and an increased risk of a deeper correction.

Three warning signals for ADA stand out

The third warning is the Tom DeMark (TD) Sequential sell signal seen on the daily chart. This indicator tracks potential reversal points by counting candles in price action according to a specific pattern. The current signal could point to a 1 to 4 candle retracement or the start of a new downward count.

According to the scenario in the analysis, if these signals are confirmed, ADA could drop to the channel’s middle support zone at $0.170. A break below this support could bring the $0.144 region, highlighted as the lower boundary on the chart, into focus. On the daily chart, the recent price zone marked around $0.188 and the $0.202 level are also drawing attention.

Santiment’s assessment presents the combination of these three indicators as a warning; however, they do not guarantee a definitive decline on their own. For these support levels to gain significance, the signals must be confirmed alongside other on-chain data and market conditions.