Why ADA May Fall Further After Exiting Top Ten Cryptocurrencies

• Cardano’s market cap has fallen more than 50% since March after losing its top 10 spot among the largest cryptocurrencies.
• Investors who bought ADA over the past two years have lost an average of 26%.
• Long-term ADA holders may capitulate as its active daily and weekly addresses hit 2020 lows.
• A daily candle close above $0.457 will invalidate the bearish thesis.

Cardano (ADA) fell out of the top 10 cryptocurrencies by market capitalization on Monday following a bearish signal in several of its on-chain assets.

ADA risk to further decline after slipping from top 10

ADA dropped out of the top 10 cryptocurrencies by market capitalization on Monday for the first time in four years, according to CoinGecko data.

ADA has underperformed in the current cycle compared to other altcoins, given that its price has been in a five-month decline since mid-March. Over the same period, its market cap has fallen 56%, falling from $27.33 billion on March 12 to ~$12 billion on Monday. ADA’s year-to-date price performance also shows that investors have seen the value of their holdings fall by 43%.

The best cryptos by market cap

The reduction, IntoTheBlock Global In/Out of the Money shows that most ADA holders have suffered large unrealized losses. Global In/Out of the Money measures all currencies and addresses average profit and loss. An address or coin is out of the money if the current price is lower than its average cost price and vice versa if it is in the money.

ADA’s In/Out of the Money value reveals that over 78% of addresses and 68% of coins are out of the money, with the largest accumulation area between $0.4 and $0.6.

Santiment’s 365-day market value to realized value (MVRV), which measures the average performance of all addresses that bought ADA in the past year, reveals that investors in this category hold an average loss of 26% – the same as the 2nd year MVRV.

ADA 365-day Dormant Circulation and MVRV

ADA’s 365-day idle circulation, which measures the movement of coins that have not left an address in the past year, saw a major increase to 719.12 million ADA on Monday – the highest level since 2022. A similar increase is also , visible in 180 days latent circulation. This suggests that long-term holders may be selling their coins, and the price of ADA has often fallen whenever these values ​​see a rise.

Additionally, Cardano’s daily and weekly active addresses fell to 19,669 and 112.25K, levels last seen in 2020.

Active daily and weekly ADA addresses

The summary of these values ​​in the chain indicates that investors are potentially strongly bearish on ADA.

In terms of technical analysis, the Awesome Oscillator displayed a bearish plate on Thursday after a red bar accompanied two consecutive green bars. While the move indicates a downward reversal, prices have remained largely sideways since it occurred. A breach of the support line around $0.275 would reinforce the bearish view.

ADA/USDT Daily Chart

On the other hand, the ADA faces the resistance of the 200-day, 100-day and 50-day simple moving average (SMA). A daily close of the candlestick above the $0.457 resistance will invalidate the bearish thesis.