Cardano (ADA) is exhibiting signs of a potential reversal, with its price action suggesting a shift. Traders have observed a TD Sequential buy signal and a bullish RSI divergence on the daily price chart. Analyst Ali Martinez suggests these patterns often indicate trend fatigue and a likely reversal, similar to what occurred at $0.52 in mid-November 2025. Cardano's recent 37% drop from its peak highs indicates that the asset may be approaching a momentum shift.
Technical Indicators Signal Potential Reversal
The technical situation for Cardano presents a subtle yet improving outlook. The Relative Strength Index (RSI) is currently hovering near 33-35, just below oversold territory. This suggests weakened momentum but not yet capitulation levels. The MACD histogram displays early indications of bullish momentum divergence, despite the prevailing bearish trend direction.
The TD Sequential indicator, developed by Tom DeMark, is designed to pinpoint trend exhaustion points. Consecutive closing prices can signal a potential downtrend reversion. The appearance of the characteristic "9" reading on Cardano's chart suggests that downward momentum may be waning. Analysts believe that after a prolonged decline, more buyers are entering at these lower price levels, as evidenced by long lower wicks on recent candles, indicating support beneath the current price action.
Critical Support Holds Strong
Cardano has demonstrated significant resilience over the past year, with the support level at $0.52 proving to be a key area. Chart analysis reveals numerous past rallies originating from this level through early and mid-2025, establishing this zone as both a psychological and technical underpinning for the asset. Each time ADA has tested this level, buyers have emerged to defend it, creating a pattern that suggests accumulation rather than distribution.
If this support level is maintained, analysts have set initial short-term targets at $0.58, representing approximately a 12% increase from current levels. A successful re-establishment above the $0.60 resistance could facilitate further upward movement towards $0.68 and $0.71. The critical area to monitor remains the $0.65 to $0.70 range, where trading above this zone would likely shift the overall technical structure from bearish to neutral or even bullish.
Whale Accumulation Signals Institutional Confidence
Concurrently, institutional players have been engaging in quiet accumulation. On-chain sentiment data indicates that whale and shark Cardano wallets, holding between 100,000 and 100 million ADA, amassed 348 million tokens, valued at $204 million, over a four-day period at the beginning of November. This accumulation represents nearly 1% of Cardano's total circulating supply and marks a notable increase compared to the net selling observed in September and October.
Large holders within the 1 million to 10 million ADA range have shown particularly high purchasing activity when prices have dipped to $0.60 or lower, a behavior historically associated with short-term rebounds. This whale activity contrasts with broader market weakness, suggesting that sophisticated investors perceive current prices as a favorable entry point.
Conclusion
Analysts are closely observing the TD Sequential buy indicator, the RSI approaching oversold territory, a potential MACD bullish crossover, and the price holding above crucial support levels. These factors collectively present what many consider a favorable risk/reward scenario for patient investors. Key confirmation signals that traders should monitor include the RSI breaking above 45 for momentum confirmation and ADA reclaiming the $0.58-$0.60 resistance zone.