Cardano (ADA) has had a strong run recently, reaching its highest point in two years, but the road to $1 is still uncertain. After reaching $0.81 on November 16, ADA has slipped back to $0.75, ignite concern that it may struggle to hit the $1 mark in the near future.

Despite a sharp increase in its price, recent trends show that the momentum behind ADA’s rally might not be sustainable. A closer look at the data and market activity suggests that Cardano faces some challenges that could prevent it from hitting that much-anticipated $1 milestone soon.

Profit-Taking and Increased Selling Pressure

One key factor affecting Cardano’s price is profit-taking. Over the last 24 hours, there has been a noticeable rise in exchange inflows, signaling that holders of ADA are selling off their tokens. According to market data, the net inflows into exchanges reached $7.21 million, which means more people are transferring their ADA to sell rather than holding or buying more. This trend puts downward pressure on the price, as more coins are being sold than bought.

While selling for profits is a common occurrence in any market, it seems particularly pronounced right now for ADA holders. As the price rose to a two-year high, many saw it as an opportunity to cash out, which has led to the recent pullback.

Low Trading Volume Signals Weak Interest

Another important signal is the decline in trading volume. Even though Cardano’s price increased by 7%, its trading volume dropped by over 50%. This is concerning because higher prices accompanied by lower volume often indicate a lack of strong interest from new buyers. When fewer people are willing to buy into the market, it becomes harder for prices to maintain or rise.

In a healthy market, we usually see a strong increase in both price and volume, which indicates growing investor confidence. However, Cardano’s recent surge came with a drop in volume, suggesting that many of the buyers are either holding back or selling for quick profits.

A Profitable Moment for Many ADA Holders

Data also shows that many ADA transactions are ending in profits. According to on-chain analytics, the profit-to-loss ratio for ADA transactions has reached 3.35, its highest point in over four years. This means that for every ADA transaction made at a loss, more than three transactions are making a profit. This high ratio reflects the general mood among Cardano traders—many are choosing to sell while they’re ahead.

Such a high ratio could indicate that more traders are willing to sell off their ADA at current prices, which could contribute to further downward pressure. If this trend continues, it may prevent Cardano from breaking the $1 barrier in the short term.

What’s Next for Cardano?

Looking ahead, ADA’s future largely depends on how the market sentiment develops. If the selling pressure continues, Cardano’s price could dip to key support levels such as $0.69. If this level fails to hold, ADA could face a more significant decline to around $0.61.

However, it’s not all doom and gloom. If demand for Cardano picks up again and market sentiment shifts in a positive direction, ADA could bounce back. A renewed buying interest could help Cardano reclaim its recent highs and potentially push the price beyond $0.81.

Conclusion

While Cardano has seen impressive gains over the past few weeks, recent trends point to uncertainty. The combination of increased selling, lower trading volume, and a high profit-to-loss ratio suggests that ADA’s journey to the $1 mark may take longer than expected. However, if demand returns, the token could still rebound and potentially reach higher levels. For now, Cardano’s path forward is unclear, and investors will need to keep a close eye on how these trends evolve.