Cardano price wobbled below the vital $0.50 level in the early hours of Jan. 19, on-chain data trail reveals key details surrounding the price downtrend.
Cardano price entered sizable gains in the first 10 days of January as investors gradually shifted focus from Bitcoin (BTC) to the altcoin markets. However, a wave of bearish headwinds and widespread market liquidations saw ADA prices tumble below $0.50 on Jan. 19.
What are the factors behind the current ADA price downtrend, and what can traders anticipate in the coming days?
Cardano whales spotted offloading $120 million ADA this week
Cardano’s price dropped below $0.50 on Jan. 19, down 25% from its peak of $0.62 on Jan 11. But looking past the price charts, the on-chain data trail reveals that the recent price downtrend could be attributed to a significant sell-off among Cardano whale investors.
Santiment whales’ wallet balances chart tracks the real-time balances in wallets holding at least $100,000 worth of a cryptocurrency.
Cardano whales holding 1 million and 100 million coins held a cumulative balance of 18.3 billion ADA as of Jan. 16. Since then, they have gone on a selling spree. Between Jan. 17 and Jan. 19, they have sold 240 million ADA, cutting their balances down to 8.1 billion ADA.
Valued at the current price of $0.50, the Cardano whales have sold off LINK tokens worth $120 million in the last three days. Singularly, a decline in balances held by whale investors is interpreted as a bearish signal.
As ADA, worth $120,000, hit the market, Cardano’s price slumped. If it persists, the whales’ outsized sell-orders could crowd out bullish retail traders, putting ADA price under intense downward pressure.
Cardano price forecast: Bears target $0.45
From an on-chain standpoint, the whales’ selling frenzy appears to be a major drive behind the ongoing Cardano price downtrend. Without a significant surge in market demand, ADA price looks set for further downsizing.
However, the bulls could mount a significant buy wall at the $0.48 area. According to IntoTheBlock’s IOMAP data, 53,600 addresses had acquired 204 million ADA at a minimum price of $0.48.
But if bears can break down this initial buy-wall, it could trigger another wave of panic sell-off, pushing prices toward $0.45.
On the flip side, the bulls could invalidate this negative forecast, if Cardano price can breakout $0.60 again. But as depicted above, the looming sell-wall at the $0.51 area could prove daunting.
