Cardano is showing signs that often appear when an asset is getting close to a market bottom. According to the data from Santiment, many holders are still sitting on painful losses, while futures traders are leaning heavily to the bearish side. However, that combination does not guarantee an immediate rally.
Santiment said Cardano holders who have been active over the past year are now sitting on an average loss of around 43 percent. The firm said this follows ADA’s sharp 71 percent drop since September and has pushed its market value to Realized Value (MVRV) to a deeply negative level.
Cardano enters a zone that has attracted buyers before
MVRV is a metric that shows whether investors are mostly in profit or loss. When it falls far below zero, it usually means many holders are under pressure, and market fear is strong.
Santiment said this extreme negative MVRV value is an ‘opportunity’ or ‘buy’ zone for traders. Simply put, many Cardano investors are currently in heavy losses. But when fear becomes this widespread, some traders start seeing lower risk for long-term buying.
Santiment also pointed to Cardano’s derivatives market. The firm said ADA’s funding rate on Binance is showing its largest short-to-long imbalance since June 2023. Funding rates help show which side of the futures market is more aggressive.
Right now, short sellers have stronger control, which means many traders are still expecting further downside. However, this can also support a rebound. If ADA starts to rise, short sellers may rush to close their positions. That kind of forced buying can accelerate the move higher.
Cardano may be worth watching, but it is still a risky investment right now. The data shows ADA is in a zone where past rebounds started, yet no recovery is confirmed. Investors should stay cautious and wait for stronger price support or clearer momentum before making a decision.
ADA price tests key support near $0.25 — What comes next?
At the time of writing, Cardano was trading near $0.264, up 5.6 percent in 24 hours. That move pushed ADA back toward the $0.25 area, which has triggered strong rebounds before.
Analyst Ali Martinez said Cardano rallied 85 percent and 200 percent the last two times it reached this zone. His chart showed ADA near $0.259, with key support at about $0.249. This means Cardano is again testing an important price area.
If ADA stays above it, a rebound may build. If it falls below it, the risk of more losses would increase. On the upside, the next major resistance is near $0.547. If Cardano breaks above that level, the next broader target on the weekly chart is around $1.195.