Home Altcoins News Cardano Whales Sell Off ADA as Realized Profits Surge

Cardano Whales Sell Off ADA as Realized Profits Surge

Cardano Whale

Cardano (ADA) has recently experienced a notable rally, pushing its price higher and drawing attention from both retail investors and large holders. As the price of ADA increased, realized profits among its holders surged, especially for those who have been holding for longer periods. However, this increase in realized profits has also led to a shift in behavior among Cardano’s largest holders, known as “whales.” Many of these whales have opted to sell their ADA holdings to capitalize on their profits, which could signal a short-term pullback in Cardano’s price.

On January 15, Cardano saw its realized profits hit a weekly high of $73.33 million, coinciding with a rise in ADA’s price towards $1.15. This sharp increase in realized profits has sparked a selling trend among large holders. Data from IntoTheBlock indicates that the netflow from large holders has dropped by 90% during the past week, signaling that whales are starting to offload their holdings. When whales sell large quantities of ADA, it often leads to downward pressure on the price as these significant sales can overwhelm market demand.

Large holders are typically defined as addresses that hold more than 0.1% of the circulating supply of an asset. The netflow metric tracks the balance of buying and selling activity from these holders, with a decrease in netflow indicating that more assets are being sold than bought. This trend has raised concerns among market participants, as the shift in whale behavior suggests that ADA might experience a price correction in the short term. While whales may be securing profits, their actions could lead to a decline in ADA’s price, especially if the selling pressure intensifies.

The technical analysis of ADA’s price action supports the notion of potential downside. The cryptocurrency’s one-day chart reveals that the coin had previously broken out of a symmetrical triangle pattern. However, the breakout was not sustained, and ADA has since failed to retest the breakout level. This failure to maintain the breakout level is a bearish signal, indicating that support at the higher price levels might not be as strong as expected. If this weakness continues, ADA could decline toward $0.94, the next major support zone on the chart.

Despite the current bearish sentiment, there remains a possibility of a bullish reversal if the market sentiment shifts. If ADA can successfully break through the upper resistance line of the symmetrical triangle, which lies at around $1.03, it could signal the resumption of the uptrend. A move above this resistance could open the door for further gains, potentially bringing ADA back toward its previous highs.

The market’s future direction will depend on how Cardano reacts to these key levels and the broader market sentiment. If Cardano continues to see significant selling pressure from large holders, it may struggle to maintain its recent gains. Conversely, a shift in sentiment or a breakout above resistance could see the price rise once again, reinforcing the bullish outlook for the long term.

In conclusion, while Cardano’s recent rally has drawn attention and sparked profits among large holders, the selling activity from whales and the failed breakout raise concerns about its short-term price trajectory. Investors will need to monitor key support and resistance levels closely, as well as whale activity, to determine whether ADA can maintain its upward momentum or if a price correction is on the horizon.

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Maheen Hernandez

A finance graduate, Maheen Hernandez has been drawn to cryptocurrencies ever since Bitcoin first emerged in 2009. Nearly a decade later, Maheen is actively working to spread awareness about cryptocurrencies as well as their impact on the traditional currencies. Appreciate the work? Send a tip to: 0x75395Ea9a42d2742E8d0C798068DeF3590C5Faa5

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