• Cardano is down over 3% so far on Tuesday, risking a steeper correction to a five-year low below $0.2200.
• Negative funding rate and a sharp imbalance in long liquidations suggest waning retail demand.
• The technical outlook for ADA is weak, with momentum indicators signaling mounting bearish pressure.

Cardano (ADA) price is down 3% at press time on Tuesday, extending a steady decline seen over the last three weeks. Cardano’s declining trend mirrors the broader market pullback and continues to lose retail strength in the derivatives market. Technically, the ADA price is under intense selling pressure and risks forming the next leg below $0.2200. 

Bears dominate ADA derivatives

Retail demand for Cardano has weakened significantly as the ADA price extends its decline for the fourth consecutive week. CoinGlass data show that ADA futures recorded $2.89 million in total liquidations over the last 24 hours, with $2.87 million in long liquidations, pointing to a clear sell-side dominance. 

At the same time, the ADA Open Interest (OI) – which tracks the notional value of outstanding ADA contracts – has dropped roughly 1% to $440.67 million, indicating that traders are reducing their risk exposure in ADA futures. That said, the funding rate sees a sharp drop to -0.0114% as traders are biased toward short-sided positional building, given the short-term bearish dominance. 

Technical outlook: How low will Cardano price go?

Cardano continues its steady decline after a reversal at the 100-day Exponential Moving Average (EMA) on May 10. ADA is down over 20% in slightly over three weeks, slipping below $0.2300. From a technical perspective, Cardano is capped below its 50- and 100-day EMAs at $0.2501 and $0.2309, respectively. The alignment of these EMAs reinforces a bearish backdrop.

That said, the Relative Strength Index (RSI) at roughly 29 on the daily chart signals oversold conditions and hints that downside momentum, though dominant, could be stretched. Meanwhile, the Moving Average Convergence Divergence (MACD) slips deeper into the negative territory below its signal and zero lines, renewing the red histogram bar and reaffirming the bearish tone.

The immediate support for ADA lies at the February 6 low of $0.2205, close to the June 10 low of $0.2200. If ADA clears below this round figure, it would signal the lowest price in five years, matching the level seen on January 5, 2021. In such a case, the S1 and S2 Pivot Point levels at $0.2129 and $0.1901, respectively, could serve as support levels.

On the topside, initial resistance emerges at the 50-period EMA near $0.2501, followed by the 100-period EMA at $0.2709.

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