Cardano, one of the leading cryptocurrencies, is facing challenges in maintaining its position in the market due to increased resistance and concerns about the macroeconomy. As of the time of writing, the price of Cardano (ADA) had dropped by 5.70% to $0.2704. This decline is part of a larger decrease of over 29% that ADA has experienced during this month. The total market capitalization of ADA has also decreased by 4.80% to $9 billion in the last day, while the trading volume of the token has increased by 29%.
The struggles of Cardano’s price can be attributed to several factors. Firstly, the cryptocurrency market as a whole has been under pressure in recent weeks, following a period of volatility and regulatory crackdowns. The US Securities and Exchange Commission’s actions in the crypto space, in particular, have affected investor sentiment. This has resulted in a decline in the global crypto market cap by almost 2% to $1.17 trillion, with the total market volume decreasing by 11.40% in the same period.
Another factor influencing Cardano’s price is the comments made by central bank leaders regarding interest rates. For instance, Andrew Bailey, the Governor of the Bank of England (BoE), defended the bank’s decision to increase interest rates by 50 basis points, higher than market expectations of 25 basis points. Bailey stated that the bank’s main objective was to lower core inflation, which has shown persistence. Similarly, Jerome Powell, the Chairman of the Federal Reserve, indicated that multiple interest rate hikes are anticipated in the future, potentially at an aggressive pace, due to the strong labor market driving inflation rates higher. These comments have raised concerns among economists who believe that such rate increases could result in a shallow recession for the US economy. Higher interest rates generally have a negative impact on risk assets, including cryptocurrencies.
In terms of technical analysis, Cardano’s price has been struggling to recover from its lows in June, as it faces strong resistance in the market. The failure to surpass the 50-day and 200-day exponential moving averages has led to a downward trajectory for ADA. The Relative Strength Index (RSI) has also decreased and is approaching the oversold region. If Cardano fails to move above the 50-day EMA, it is likely to experience further decline, with the next support level expected at $0.2420. However, if the price manages to surpass the critical level of $0.300, it could provide enough momentum for bullish investors to push the price higher.
Overall, Cardano’s price struggles can be attributed to the broader challenges facing the cryptocurrency market, including regulatory crackdowns and concerns about the macroeconomy. The comments made by central bank leaders regarding interest rates have also contributed to the downward pressure on ADA. Traders and investors will continue to closely monitor Cardano’s price action, hoping for a bullish breakout that could reverse the recent performance of the asset.
In conclusion, Cardano’s price has been experiencing difficulties in maintaining its position in the market due to increased resistance and concerns about the macroeconomic environment. The wider cryptocurrency market has also been under pressure, and comments by central bank leaders regarding interest rates have further contributed to Cardano’s struggles. Traders and investors will carefully watch Cardano’s price action in the coming days, hoping for signs of a bullish breakout.
