Cardano Price Forecast: Whale selling deepens ADA correction

• Cardano ticks above $0.2100 on Friday after declining nearly 6% the previous day.
• On-chain data show that whales have significantly reduced their ADA holdings, fueling selling pressure.
• ADA Open Interest declined 11% in 24 hours as the funding rate turned negative and long liquidations rose, suggesting sell-side dominance.

Cardano (ADA) edges higher by nearly 2% on Friday, following a roughly 6% decline the previous day. The pullback aligns with the sell-side appeal among large-wallet investors, commonly referred to as whales, and Cardano derivatives. The technical outlook for ADA is bearish, with downside momentum persisting.

Whales trimming their ADA holdings

Whales are losing their appetite for holding ADA tokens, fueling near-term selling pressure. Santiment data shows whales holding 10 million to 100 million ADA tokens have reduced their dominance to 37.93% of the circulating supply on Friday, down from 38.27% on October 10. 

Meanwhile, cohorts holding over 100 million ADA tokens account for a smaller share of the circulating supply, dominating 16.04% on Friday, up from 15.92% in the same period. At the same time, the ADA supply in profit has dropped to 17.8% from 30.78%, implying a sudden profit-booking phase. 

Taken together, whale activity shows a sell-side bias, which could weigh on future recovery moves.

Cardano futures build sell-side bias

Cardano is also losing its bullish appeal among retail traders. CoinGlass data shows the ADA futures Open Interest (OI) is down 11% over the last 24 hours to $464.36 million, indicating reduced value of active positions as spot price declines. Typically, a declining OI and spot price suggest long-sided positional unwinding and declining leverage. Total liquidation in the same period amounts to $1.60 million, led by $1.56 million in long liquidations, reaffirming strong selling in the market. 

At the same time, the funding rate has flipped negative to -0.0064%, indicating that traders are willing to pay a premium to buy short positions.

Technical outlook: Can Cardano defend the $0.20 support?

Cardano trades at $0.2159 at press time on Friday, facing downside pressure below key moving averages and the former rising support line. The 50-day Exponential Moving Average (EMA) at $0.2274 and the broken upward trend line around $0.2282 now sit overhead, reinforcing a capped, bearish near-term tone, while the 200-day EMA at $0.2322 marks a higher structural barrier.

The Relative Strength Index (RSI) at 41 suggests weak momentum, and the Moving Average Convergence Divergence (MACD) is declining into negative territory, hinting that sellers still have the upper hand.

Looking down, the path of least resistance highlights the $0.2000 round figure as the immediate support, followed by the $0.1894 horizontal level set by the August 30 low.

On the topside, initial resistance is at the 50-day EMA near $0.2274, followed closely by the reclaimed trendline at $0.2282, forming a tight supply zone that bulls would need to overcome to ease immediate downside risk. A more significant hurdle emerges at the 200-day EMA around $0.2322, where a sustained daily close above would start to undermine the current bearish bias and open the way for a broader recovery.

(The technical analysis of this story was written with the help of an AI tool. Know more.)