Cardano (ADA) is down by 1.5% on Wednesday after failing to overcome resistance at the 50-day Exponential Moving Average (EMA) near $0.1770.
The rejection erased the momentum from two consecutive recovery sessions earlier in the week, leaving the cryptocurrency vulnerable to additional downside.
Weakening activity in the derivatives market and subdued technical momentum suggest traders remain cautious, with ADA struggling to establish a sustained bullish trend.
Cardano futures activity signals declining retail interest
Retail participation in the Cardano derivatives market has cooled considerably over the past 24 hours.
According to CoinGlass, ADA futures Open Interest (OI) fell 4.7% to $411 million, indicating a decline in outstanding leveraged positions. At the same time, trading volume dropped 45% to $329.1 million, reflecting lower speculative activity.
A simultaneous decline in both Open Interest and trading volume typically points to fading retail demand and reduced market conviction.
Selling pressure also remains elevated. Long traders absorbed the bulk of recent liquidations, with $273,040 in long positions wiped out compared to $162,360 in short liquidations.
The imbalance suggests bearish sentiment continues to dominate the short-term market.
Meanwhile, the funding rate remained positive at 0.0044%, although it has eased from 0.0088% recorded the previous day.
The lower funding rate indicates that bullish sentiment among leveraged traders is gradually weakening.
ADA price faces strong technical resistance
The ADA/USD 4-hour chart is bearish as Cardano continues to trade below several important resistance levels.
ADA remains below both the 50-day EMA at $0.1770 and the descending resistance trendline near $0.1782, creating a significant overhead supply zone that has repeatedly rejected bullish attempts.
On the downside, the token continues to hold above the broken structural support level around $0.1629, which now serves as the first major support area.
Momentum indicators paint a bullish picture. The Moving Average Convergence Divergence (MACD) histogram remains slightly positive, suggesting that bullish momentum has not disappeared completely.
The Relative Strength Index (RSI) hovers around 59, indicating a slightly bullish momentum but a lack of strong directional conviction.
Overall, the inability to reclaim key resistance levels keeps the broader technical outlook tilted toward the downside.
If the buyers reclaim control, the first hurdle for buyers remains the 50-day EMA at $0.1771, followed closely by the descending trendline at $0.1782.
A decisive breakout above this resistance zone would weaken the current bearish structure and could pave the way for a move toward the next major resistance level at $0.2205.
Conversely, if sellers regain control, immediate support lies at $0.1629.
A break below this level could accelerate losses toward the horizontal support area around $0.1486, where buyers may attempt to establish a stronger base.
Until ADA clears its overhead resistance, declining futures activity, weaker retail participation, and cautious technical indicators suggest that the cryptocurrency may continue to face downward pressure in the near term.
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