The Cardano price has remained in a narrow range in the past few days as investors focus on the upcoming interest rate decision by the Federal Reserve. ADA is trading at $0.80, which is close to its lowest level since February 2021. There are three main reasons why the Cardano price has struggled in the past few months, costing its investors over $65 billion of value.
First, like other cryptocurrencies, it has fallen because of the ongoing tightening by the Federal Reserve. The bank started winding down its asset purchase program in November last year. It is now expected to deliver the first interest rate hike since 2018 today. Historically, high-risk assets like Cardano tend to lag in a period of high-interest rates.
Second, Ada price has dropped because of the rising fear of the platform’s ecosystem. While there are developers building on Cardano, the reality is that there are very few mainstream projects built using its technology. The only one that comes to mind is SundaeSwap, which is a platform competing with the likes of Uniswap and PancakeSwap. Finally, Cardano price has fallen because of the ongoing competition in the industry. There are many projects that are similar to Cardano like Fantom, Avalanche, and Near.
Cardano price prediction
The daily chart shows that the ADA price has been in a strong bearish trend in the past few months. As a result, the coin has moved below all moving averages. It has also formed a descending channel that is shown in blue. The Smart Money Index (SMI) has also been in a downward trend. The same is true with other oscillators like the Relative Strength Index (RSI) and the MACD.
Therefore, there is a likelihood that the Cardano price will likely keep falling as bears target the next key support level at $0.50, which about 38% below the current level. A move above $1 will invalidate this view.