Cardano Drops 7%: Could It Fall to $0.80 Next?

Cardano (ADA) lost over 7% in just one day, with its price hovering at $0.860. This drop has brought it near an important support at $0.848, and analysts are now watching to see if $0.80 will be tested.

Market Forces Impacting Cardano

The recent decline in Cardano aligns with broader weakness across the cryptocurrency market. BTC dropped to $113k, pulling high-beta altcoins like ADA downward.

Beyond that, traders in the futures market now anticipate a 25% likelihood that the Fed will hold off on cutting rates in September. This scenario is creating pressure on speculative assets like ADA, with investors taking precautionary steps. The mix of macro uncertainty and momentum-driven selling is creating a volatile environment where support levels may face stronger tests than usual.

ADA’s recent pullback could also be viewed as a healthy adjustment following weeks of rapid gains. On-chain data show that whales have been moving ADA to exchanges, hinting at potential further selling pressure. Since August 19, more than $6 million in long positions has been liquidated, suggesting that the market is digesting the recent rally before deciding on its next direction.

Technical Weakness and Support Levels

Cardano is facing technical challenges that could affect its near-term price. ADA has struggled to rise above the $0.90 to $0.95 resistance area, where selling is strong. Buyers are cautious, and the key support at $0.848 is important. If it falls below this level, the price could drop toward $0.80, about 6% lower.

Chart signals also point to vulnerability. ADA recently fell out of a triangle pattern, and the relative strength index stands at 44, nearing oversold conditions. This suggests weakening momentum, although short-term oversold readings may attract opportunistic buying. Traders monitor these indicators to identify potential bounces or further declines.

What we see here resembles the behavior of other altcoins after long rallies. Coins breaking below multi-week support commonly face steep drops, especially when market sentiment shifts toward caution. Cardano needs to reach the $0.90 to $0.95 range again to restore upward momentum.

What Traders Should Consider?

Cardano’s next steps will be influenced by a few critical factors. Powell’s Jackson Hole speech could change market sentiment rapidly, affecting both BTC and altcoins. ADA moves are worth monitoring, as large transfers to exchanges often point to selling, while accumulation may provide short-term stability.

Technically, the $0.848 support level is critical. If it fails, ADA could test $0.80 quickly. But if it holds and resistance near $0.90 is reclaimed, bulls might regain control. Short-term buyers may step in as RSI nears oversold levels, making this a delicate moment for traders.

The Outlook for Cardano

In short, Cardano is encountering significant technical and macroeconomic pressures. If it drops below $0.848, further declines could follow. On the other hand, surpassing resistance above $0.90 could improve market sentiment and encourage buying activity.

Looking ahead, Cardano’s next move will depend on broader market trends and technical signals. For the moment, careful trading seems advisable as the market absorbs recent volatility.