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- Cardano funding rates have decreased to -49%, which indicated the lowest level in more than a year.
- This decline showed great demand for short positions as the bears were rising.
The cryptocurrency market recorded huge losses on February 3, and the total market capitalization dropped by 10% within 24 hours.
Cardano (there) He was among the biggest losers after falling by 24% for a $ 0.67 trade at the time of the press.
Altcoin’s drop has recorded more than $ 31 million in the long positions of Ada. This marked the second highest level of long liquidations in one year.
As these positions closed strongly, it caused an increase in the sales activity that put pressure on the price.
This long squeeze also caused a shift in the Cardan’s derivative market, as can be seen in the drastic fall in the funding rate.
Financing rates have reached an annual low
Cardan’s funding rates have recorded a major decline in the last 24 hours and reached the lowest level in one year.
At the time of the press, this metric was -49%, indicating great demand for short positions and the reduced bets that Ada would receive.
Source: COINGLAS
The stricter decrease in the funding rate shows that traders became bears on Altcoin because they predicted a further decline. However, such a steep decline could lead to a potential short squeeze if the trend is unexpectedly reversed.
Can Cardano bounce from a two -month low?
Cardano’s 24-hour decline led to the price that fell to the lowest level in almost three months. The sellers were behind this fall, as can be seen in $ 736 million on the sale of volumes.
However, the sellers could be close to achieving exhaustion after the decline of the relative power index (RSI) to a rollover of 25.
Ada also related under the lower Bollinger belt with large quantities, which also indicates conditions.
Source: TraringView
If traders start buying an instant crash, it could start a trend turning point. Nevertheless, in order to confirm the bull trend, Ada must reverse the resistance to $ 0.84.
On the other hand, a drop below a $ 0.31 support level could cause further decline.
Read the prediction of prices Cardano (ADA) 2025–2026
Decreased Defica activity could stimulate the fall
Data from Break showed a significant drop in the Cardano network activity. At the time of the press, the total value locked (TVL) fell to $ 312 million, which indicated the lowest level since the beginning of November.
This declining activity could encourage Cardan’s bear trend. However, traders should look out for progress in defined activities, as this could match the set.
