Cardano Faces 50% Drop to $0.42 as Elliott Wave Theory Predicts Imminent Crash

Coin WorldTuesday, May 27, 2025 10:08 am ET
1min read

Cardano (ADA) has been experiencing a steady upward trend over the past few weeks, despite being rejected at the $0.84 price level last week. The current price action remains robust, with only a minor drop in the past 24 hours. However, a technical analysis based on Elliott Wave theory suggests that a significant price decline could be imminent for ADA, with a potential drop to as low as $0.42 in the coming weeks.

According to the Elliott Wave count presented in a technical analysis, Cardano is currently completing a B-wave correction that has been forming between April and June 2025. This B wave is part of a larger corrective phase, which, although it may appear impulsive on lower timeframes, is actually a trap before the final C-wave crash. Based on this forecast, the price of Cardano could soon initiate a sharp decline, bottoming out near the $0.42 region, which aligns with the 0.786 Fibonacci retracement level from the previous impulse.

This ABC formation is part of a larger corrective Wave 4 before a bullish Wave 5. The prediction suggests that ADA should not fall below $0.40, which marks the top of the first major wave in the overall bullish structure. A move lower than that would risk invalidating the broader long-term setup.

If the technical analysis plays out as predicted, the projected crash to $0.42 would represent a 50% drop from the current price of Cardano. While this may be concerning for short-term holders, this bearish wave could also present a hidden opportunity. The projected Wave C crash to $0.42 would be followed by a bullish impulse Wave 5 that could push ADA above the $1 mark again, with a target of $1.6. If ADA corrects toward $0.42–$0.40, it would provide a good accumulation zone before the next leg up.

Although this bearish forecast is well-supported by Elliott Wave principles, it is not a guaranteed outcome. ADA and other large market-cap cryptocurrencies are highly reactive to Bitcoin’s price action. If Bitcoin extends its rally and breaks into new all-time highs soon, the projected ADA correction may either be muted or entirely invalidated. It will be interesting to see how the ADA price action plays out in the next few days.

At the time of writing, ADA is trading at $0.7706, down by 0.2% in the past 24 hours.