Cardano (ADA) Faces Challenges to Maintain $1 Amid Ongoing US Reserve Discussions

Cardano (ADA) has experienced a decline of over 6% on Thursday, although it has still risen by nearly 40% in the past week. Following its integration into the US crypto strategic reserve, ADA surged to $1.15 but has struggled to remain above the $1 threshold in recent days.

With doubts arising regarding its inclusion in the reserve, many users are questioning its current price stability. As whale accumulation appears to be slowing and breaking through the $1 resistance has proven challenging, ADA’s future movement hinges on either the return of bullish momentum or increased selling pressure pushing it downward.

Current ADX Points to a Dwindling Uptrend

The Average Directional Index (ADX) for Cardano currently stands at 32.5, a decrease from 43.7, which was noted just three days prior due to the price increase associated with its inclusion in the US crypto strategic reserve.

Despite the drop, the ADX remains above 25—signifying a robust trend—however, the momentum has weakened somewhat.

Assessing the ADX can provide crucial insights into market movements. Following a recent surge, if ADA’s ADX continues to decrease, the established uptrend may lose traction, hinting at a potential slowdown or consolidation phase. Conversely, should the ADX stabilize or rebound, ADA could re-establish upward momentum and potentially challenge new resistance levels.

Whale Activity Indicates Reduced Accumulation

Recent data shows a slight decline in the number of Cardano whale addresses—those holding between 1 million and 10 million ADA. After witnessing an increase from 2,442 to 2,471 between March 1 and March 4, the current count has receded to 2,463. This suggests that some large holders may be offloading their positions following ADA's recent price surge, driven in part by skepticism from the crypto community regarding its place in the US strategic reserve alongside XRP.

Monitoring these whale movements is critical, as they have the potential to influence market liquidity and price dynamics. A decline in the whale count could indicate profit-taking or waning confidence among large holders. If accumulation does not resume, ADA's uptrend could slow further.

Potential Testing of the $1 Mark

Currently, Cardano's Exponential Moving Averages (EMAs) depict a bullish trend, with short-term EMAs residing above their long-term counterparts. However, despite this overall positive signal, ADA has struggled to breach the $1 level recently, primarily following a sharp correction after its remarkable 71% rise on March 2.

If the trend shifts toward a downtrend, ADA may test support around $0.818, with a potential fall below that critical point leading to $0.75. Additionally, a more intense market selloff might drive the price even lower, possibly to $0.63 or $0.58. However, if ADA is able to regain its momentum, it could once again test the $1 mark, and a successful breakout could propel the price toward $1.17, a level it nearly reached during the surge on March 2.