Cardano (ADA) Completes Death Cross as Volatility Tightens: Potential Scenarios

The crypto market fell for a second day on Tuesday, with Cardano ($ADA) price returning to trade in the red. At the time of writing, $ADA was down 0.41% in the last 24 hours to $0.246, extending its drop into the second day and down 1.83% weekly.

$ADA's hourly MA 50 has fallen below the MA 200, which means that it has completed a death cross on its hourly chart. This bearish signal comes as Cardano's volatility tightens. As seen on the daily chart, Cardano is coiling in a tight range between $0.241 and $0.257.

Cardano has largely traded sideways between $0.236 and $0.295 since mid-March, with the range now getting tighter in the last few days. This kind of squeeze often precedes a major move in either direction.

In the short term, the daily MA 50 at $0.254 remains a major barrier that has limited $ADA's price since March and must be surpassed for $ADA to gain positive momentum.

If the price goes down, support is expected to be at $0.241 and then at $0.236 in the short term.

Derivatives data hints at selling pressure

Derivatives data suggests a negative 24-hour cumulative volume delta (CVD) for Cardano, indicating that more trades are being initiated by market sellers hitting bids than by market buyers lifting offers. This suggests aggressive selling pressure, even though a buyer matches every seller.

This is in line with the broader market trend marked by cooling derivatives activity, lower open interest, volume, and liquidations. Funding rates and options data point to cautious, hedged positioning.

Total crypto futures open interest (OI) has fallen by 1.88% to $154 billion in the past 24 hours, according to CoinGlass data.

In positive news, Cardano is preparing for its biggest technical upgrade, Leios, with the testnet expected to be released in June. The Leios upgrade targets a 10 to 65x increase in throughput and moves Cardano toward 1,000+ TPS, with the mainnet planned by the end of 2026.