Crypto whales dump $326M in Cardano (ADA) post Chang hard fork

Cardano (CRYPTO:ADA) is facing potential delays in breaking out of its bullish pattern due to current market conditions and signs of overvaluation. 

Following the recent Chang hard fork, the cryptocurrency’s price recovery remains uncertain. 

Key investors, known as crypto whales, have started offloading their ADA holdings, signaling bearish sentiment. 

The Network Value to Transaction (NVT) ratio, which measures a cryptocurrency’s market capitalization relative to its transaction volume, indicates that ADA is currently overvalued. 

At a yearly high of 6.43, the NVT ratio suggests potential corrections or delays in price rallies. 

This overvaluation is a bearish signal for any asset, as it often leads to market corrections. 

Crypto whales, who play a crucial role in driving market trends, have not shown confidence in ADA’s potential recovery. 

Addresses holding between $100,000 and $1 million worth of ADA have sold off 15% of their holdings in the past ten days, totaling $326 million in value. 

This mass sell-off reflects a ‘sell-the-news’ strategy, where traders capitalize on the hype of significant developments, such as the Chang hard fork, before exiting their positions. 

This behavior often triggers market corrections as the initial excitement fades, leading to decreased prices. 

Given the ongoing sell-off and minimal accumulation by these large holders, ADA’s price growth remains constrained. 

Analysts suggest that Cardano may experience a further drawdown to the support level of $0.31, a critical floor that could potentially allow for a recovery if breached. 

However, if the market and investor sentiment do not improve, there could be a deeper correction, delaying any bullish breakout. 

Cardano’s price has been trading within a descending wedge pattern for over four months, beginning in mid-April. 

While a breakout could eventually occur, market conditions and investor sentiment will play a key role in determining the timing and extent of any potential recovery. 

A successful breakout could lead to a 47% rise, setting the target price at $0.53. 

At the time of reporting, the Cardano (ADA) price was $0.336.