Cardano is trying to stabilize after a rough stretch. ADA is up about 1.8% over the past 24 hours, but the broader picture remains weak. The token is still down nearly 9% over the past seven days, and the Cardano price continues to trade below key short-term trend levels.
At first glance, the move looks like a simple bearish continuation. But when participation, holder behavior, and derivatives positioning are viewed together, the story becomes less straightforward. The sell-off may have a more layered story to tell.
Cardano Loses Its Trend as Spot Interest Collapses
The weakness started with participation, not just price.
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On January 6, Cardano’s spot trading volume on decentralized exchanges peaked near $1.49 million as identified by BeInCrypto analysts. That same day, ADA also printed its highest price of 2026 so far. From that point, both price and activity rolled over together.
By January 22, spot trading volume had collapsed to roughly $68,552 (still incomplete), a drop of more than 95% in just over two weeks. This data reflects spot trades only, meaning real buying and selling (swaps), not leveraged bets. When spot volume falls this sharply, it usually signals that retail participation has stepped away.
Spot Trading Volume Dips: Dune AnalyticsNote: DEX spot volume reflects organic token demand, as trades are settled on-chain primarily without leverage, forced liquidations, or market-maker buffering.
That drop in activity lined up cleanly with a technical shift.
Cardano lost its 20-day exponential moving average (EMA) in mid-January. An EMA gives more weight to recent prices and is often used to track short-term trend direction. Losing it typically signals that momentum has shifted from buyers to sellers.
This pattern has mattered for ADA before.
In early October, losing the 20-day EMA preceded a 55% decline into December. A similar loss between December 11 and December 31 led to a 25% correction.
Cardano Breaks Under Trendline: TradingViewSponsored
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This time, once ADA fell below the 20-day EMA, spot participation did not stabilize. It worsened. With fewer spot buyers stepping in, the price slid more easily, setting the stage for aggressive bearish positioning.
That is where the second layer of the story begins.
Whales Add Into Weakness as Shorts Crowd the Market
While spot traders were exiting, large holders were not.
Addresses holding more than 1 billion ADA began accumulating around January 14, even as Cardano’s price continued to slide. This cohort increased its combined holdings from 1.92 billion ADA to 2.93 billion ADA, adding roughly 1.01 billion ADA during the correction. At current prices, that translates to approximately $360–$380 million accumulated while price momentum was still negative. Most importantly, they keep holding the stash despite breakdown (s).
A second whale group followed shortly after. Wallets holding between 10 million and 100 million ADA started adding on January 17, the same day Cardano fully lost its 20-day exponential moving average (EMA). Their holdings rose from 13.61 billion ADA to 13.64 billion ADA, an addition of roughly 30 million ADA, or about $11 million at current prices.
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ADA Whales Stay Strong: SantimentThe timing matters. These whales were not buying into strength. Both groups stepped in after the trend break, after the spot interest collapsed, and after the bearish structure became obvious. That behavior suggests positioning during visible weakness, not momentum chasing.
Meanwhile, derivatives traders moved the other way.
The loss of trend support and collapsing spot volume made the bearish case look clear. Short positions piled in across perpetual futures, $22.12 million in short leverage. On Binance, ADA is now heavily short-biased, with short liquidation exposure roughly 2.5 times larger than long exposure.
Liquidation Map: CoinglassThis imbalance matters.
When spot traders leave and shorts crowd in, the price can move sharply even on modest buying. Whales accumulating during that phase are often positioning for either a quick trend reclaim or a forced move higher driven by liquidations.
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That brings the focus to structure and levels.
Cardano Price Levels That Decide Whether Bears Get Trapped
On the 12-hour chart, Cardano did break down from a head-and-shoulders structure around January 20. That breakdown likely triggered the final wave of spot selling and encouraged the surge in short positions.
But momentum is no longer confirming continued downside.
The Money Flow Index (MFI) has started rising while the price holds near recent lows. MFI tracks buying and selling pressure using both price and volume. When it rises as price stabilizes, it often signals dip buying rather than panic selling. That could mean the return of spot buyers as MFI breaks above the descending trendline, leaving only short positions at risk.
Short liquidation pressure begins building near $0.37. A move above that level would start forcing short positions to close. Above $0.39, liquidation pressure increases meaningfully. A push toward $0.42 would place most near-term short exposure at risk.
Cardano Price Analysis: TradingViewThe bearish case regains full control only if ADA breaks and holds below $0.34. A sustained move under that level would invalidate the stabilization thesis and reopen downside risk toward prior lows.
Until then, Cardano remains caught between fading retail participation and growing whale conviction. Spot traders may have stepped away, but the positioning underneath suggests the move may not be finished yet.
Source: https://beincrypto.com/cardano-price-volume-whale-divergence/
