ADA surged 11% after Grayscale filed for a spot ETF. But with the hype fading, will the rally hold, or is a deeper correction coming?
Cardano ETF Sparks Brief Rally
Cardano’s ADA jumped 11% on Tuesday, reaching $0.82, after Grayscale Investments filed for the first-ever spot ADA ETF in the U.S.. However, the excitement was short-lived. ADA has since dropped 4%, now trading at $0.76.
Despite the decline, daily trading volume surged by 48% to $1.44 billion. Increased volume during a price drop signals strong selling pressure, suggesting that many traders are cashing out.
Bearish Signals Suggest Further Decline
ADA’s Balance of Power (BoP) indicator stands at -0.54, confirming that sellers currently dominate the market. A negative BoP means that bearish momentum is growing, increasing the likelihood of further price drops.
If selling pressure continues, ADA could fall to $0.70. If this support level breaks, the price might plunge to $0.53, a level last seen on February 3.
Can ADA Regain Momentum?
For a bullish reversal, buyers must regain control. If accumulation increases, ADA could climb back to $0.82. However, the market remains uncertain, and investors are closely watching whether the ETF speculation will drive renewed interest or lead to more selloffs.
