Cardano Drops 0.406% Amid Whale Accumulation, Ethereum Upgrade Looms

Cardano's latest price was $0.6715, down 0.406% in the last 24 hours. This slight decline comes amidst a backdrop of significant whale activity, with large investors accumulating substantial amounts of ADA. In April, whales accumulated over 410 million ADA, indicating a strategic positioning at sub-$0.70 levels. This accumulation suggests that large investors view current prices as attractive entry points, which historically precedes strong price movements. The increase in whale wallets, particularly those holding between 10 million and 100 million ADA, further supports this trend. The total value of ADA bought by these whales amounts to approximately $289 million, reflecting a substantial investment in the cryptocurrency.

On-chain data reveals that addresses holding between 1 million and 10 million ADA also increased, from 2,405 to 2,408. This level of accumulation is a positive sign for Cardano, as it indicates that large investors are confident in the cryptocurrency's potential for growth. The current market dynamics, with ADA trading around $0.68 and a market cap of $24 billion, suggest that the cryptocurrency is consolidating between support at $0.66 and resistance at $0.75. The 200-day simple moving average (SMA) sits near $0.77, serving as an important barrier for bulls to overcome.

Cardano's market dynamics are further influenced by the upcoming Ethereum Pectra upgrade, scheduled for May 7. Historical trends show that major improvements to the Ethereum network often coincide with pressure on ADA. Previous Ethereum upgrades, such as the London upgrade in 2021, the Merge in 2022, and the Dencun upgrade last year, have all resulted in sharp declines for Cardano. If this pattern repeats, ADA may face significant downside risk, especially if it breaks below key support levels. A drop to around $0.66 could trigger long liquidations totaling over $5.4 million, potentially accelerating selling pressure.

Ask Aime: Will Cardano's price drop further from $0.68?

Despite the potential downside risk, Cardano's current market dynamics, underscored by increased whale activity and favorable technical indicators, position the cryptocurrency for potential growth. The next few trading sessions will be crucial in determining ADA's trajectory moving forward. Investors are encouraged to remain vigilant as developments unfold, particularly in light of the upcoming Ethereum upgrade and the potential impact on Cardano's market dynamics. The long-standing competition between Cardano and Ethereum, both among the earliest layer-one blockchains, has frequently seen ADA underperform during key Ethereum upgrades aimed at enhancing scalability and usability. This dynamic adds an additional layer of complexity to Cardano's market outlook, as investors weigh the potential impact of Ethereum's advancements on ADA's performance.