The price of Cardano may continue to fall as LTH experiences the first loss after 3 months.

Cardano (ADA) faces new bearish pressure as long term holders (LTH) begin to realize losses for the first time in three months.

The fact that the price of ADA has not grown recently has erased the previously accumulated gains, reflecting signs that investor confidence is gradually weakening. If selling pressure continues to increase, the recovery prospects for ADA will become even more difficult.

The strength of Cardano holders is declining

The Long/Short difference index of MVRV indicates that Cardano LTHs are facing the risk of losses, as their average profit has significantly decreased after the recent price correction. This index, which compares the average profit of LTHs with those of short-term holders (STH), shows a sharp decline following the recent correction of ADA. As a result, many long-term investors are currently holding below their original price, reducing their market holding motivation.

In this context, short-term traders may take advantage of the opportunity to buy at low prices. However, their quick profit-taking trend poses a risk of limiting the stable recovery potential of ADA. If short-term investors continuously sell as soon as the market shows signs of growth, the selling pressure will increase, making it difficult for Cardano to regain its lost position.

Long/Short spread of MVRV | Source: SantimentAccording to the Relative Strength Index (RSI), the market momentum of ADA continues to maintain a negative state as the RSI is currently below the neutral level of 50. This reflects the prevailing bearish sentiment, while also indicating that ADA has not attracted enough buying pressure to reverse the recent bearish trend.

Cardano's RSI Index | Source: TradingViewThe RSI remaining in the negative zone for a long time is often associated with prolonged accumulation phases or deeper corrections. Without the return of investment inflows or growth in trading volume, the price of ADA is likely to continue to remain low.

ADA price may need more time to recover

Currently, the price of ADA is at $0.645, slightly above the important support area of $0.623. However, ADA has not yet been able to break through the strong resistance levels at $0.667 and $0.699, limiting the bullish trend.

Even if ADA holds above the support level of $0.623, the price may continue to fluctuate within the accumulation zone, maintaining a neutral to bearish state and is not able to generate a strong rebound in the short term.

Cardano Price Analysis | Source: TradingViewThe only recovery path for ADA is to clearly break above the resistance level of $0.699, opening up the opportunity to advance towards the price range of $0.754. To achieve this, holders need to refrain from selling early, allowing it to maintain upward momentum and restore confidence in the bullish trend.

Mr. Teacher