Is Cardano’s Upward Momentum at Risk? Critical Metrics Indicate Possible Reversal

• Cardano’s RSI at 51.23 shows a neutral market, but a declining trading volume could signal weakening demand.
• Despite a price rise, Cardano faces bearish pressure with MACD below the signal line and falling open interest.
• A drop in trading volume and open interest for Cardano may suggest cautious trader sentiment, impacting its uptrend.

Cardano (ADA) has recently been on a recovery path, sparking discussions about whether its price rebound is sustainable. Several key indicators provide insight into the current market dynamics. These indicators suggest potential challenges and opportunities for Cardano in maintaining its upward momentum. 

Cardano, priced at $0.135192 at press time, has seen a 4.02% rise in the last 24 hours. The 1-week RSI for Cardano stands at 45.46, indicating that it is neither overbought nor oversold. However, the 1-week MACD trading below the signal line hints at a possible bearish trend. The combination of these indicators suggests that Cardano’s price could face pressure in the short term.

Cardano’s recent price recovery faces challenges from declining trading volume and open interest. Over the past 24 hours, Cardano’s trading volume dropped significantly, from around $390 million on July 25 to approximately $310 million. This decline of more than 15% is a critical factor that could impact Cardano’s price trajectory. If trading volume continues to fall, it may signal weakening demand, leading to potential price stabilization or reversal if selling pressure increases.

As per Coinglass data, open interest in Cardano has also decreased slightly, according to data from Coinglass. It fell from approximately $208 million to around $201 million over the last 24 hours. Open interest measures the total number of outstanding derivative contracts, such as futures and options, that remain unsettled. A decline in open interest typically indicates that traders are closing their positions, which could suggest reduced confidence in sustained price movements.

Moreover, the relationship between trading volume and open interest is crucial in assessing market sentiment. A declining trading volume combined with falling open interest may point to traders’ cautious stance, potentially impacting Cardano’s upward trend. Furthermore, these indicators, when considered together, highlight the importance of monitoring market activity closely.