Cardano price pulled back sharply as focus shifted to the upcoming American inflation data. Ada fell to a low of $0.50, which was the lowest level on August 5th. This price was about 8% below the highest point this month. The performance is also in line with that of other cryptocurrencies like Polkadot, Kusama, Cosmos, and Celsius.
Ada recovery stalls
Cardano is a leading smart contract platform that developers use to build decentralized applications in key industries like DeFi, metaverse, and non-fungible token (NFT) projects. However, Cardano has a relatively small ecosystem, unlike its key competitors like Polkadot, BNB, and Ethereum. This is simply because Cardano launched its smart contract upgrade in 2021.
Like other cryptocurrencies, Cardano’s price has gone through a tough period in the past few months. In this period, it moved from an all-time high of about $3 to a low of $0.402. As a result, its total market cap crashed from over $90 billion to less than $20 billion.
Cardano price has crashed as the total value locked (TVL) in its ecosystem crashed. According to DeFi Llama, Cardano’s TVL has crashed to just $93 million from an all-time high of over $393 million. Moreover, its TVL has crashed even as that of its competitors like BNB and Ethereum rebounds.
The main catalyst for the crash is WingRiders, whose TVL has dropped by more than 60% in the past 30 days. In addition, SundaeSwap and MeowSwapFi have seen their TVL have crashed by over 10%.
Cardano price prediction
The four-hour chart shows that the Ada price has been in a bullish trend in the past few weeks. Unfortunately, this recovery saw the coin rise to the important resistance point at $0.5560. It has now formed a triple-top pattern, which is usually a bearish sign. Also, it has crossed the important 25-day and 50-day moving averages.
Therefore, the coin will likely continue falling as sellers target the next key support level at $0.45, which is about 12% below the current level. A move above the resistance point at $0.5230 will invalidate the bearish view.