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Cardano (ADA) Drops to $0.9267 Amid Bearish Market Conditions

Cardano’s price dipped to $0.9267, marking its second consecutive bearish trading session on January 13, with a 7% decline over the past 24 hours to $0.930. Bearish technical patterns and several on-chain signals suggest that ADA may face deeper corrections in the coming days.

Risk-Off Mode and Wider Crypto Sell-Off

The bearish sentiment on January 13 extended beyond Cardano. The entire crypto market experienced a downturn, with significant sell-offs of risk assets as markets reacted to the U.S. Federal Reserve’s increasingly aggressive stance.

The total cryptocurrency market capitalization dropped by 1.73% over the last 24 hours, standing at $3.25 trillion at the time of publication. This market decline follows stronger-than-expected U.S. macroeconomic data, which dampened hopes for capital inflows into the crypto space.

Interest Rate Expectations Shift

Futures markets now predict that the Federal Reserve is less likely to lower interest rates as much or as quickly as previously anticipated. According to CME Group’s FedWatch tool, the probability of even a minor 0.25% rate cut during the Fed’s January meeting is just 2.7%.

Sentiment indicates fewer rate cuts in 2025 than earlier forecasts, with market participants now expecting only 1–2 reductions for the year. “Rate hike possibilities are back on the table, and markets don’t like that,” said The Kobeissi Letter in a January 13 post on X.

Weak On-Chain Metrics Support ADA’s Decline

Data from Artemis shows that ADA’s price decline aligns with reduced investor interest and lower liquidity on the Cardano blockchain. Daily trading volumes on ADA-based decentralized exchanges (DEX) dropped from $31.3 million on December 12, 2024, to $4.9 million on January 12, the lowest level since November 7.

Similarly, daily active addresses fell by 70%, from approximately 96,700 to 29,500 over the same period. Additional data from DefiLlama reveals that the total value locked (TVL) in the Cardano network decreased from $701.4 million on December 3, 2024, to $492.7 million on January 13.

This decline in active addresses, DEX trading volume, and TVL coincides with a 30% drop in ADA’s price during the same period.

Bear Flag Pattern Signals $0.72 Target

Technical indicators show a bear flag pattern on ADA’s four-hour candle chart. This bearish continuation setup forms when prices consolidate within an upward channel after a sharp decline.

The bear flag broke during the Asian trading session on January 13, with ADA’s price falling below the flag’s lower trendline at $0.945. ADA’s price may now drop by the height of the previous downtrend, setting a lower target of $0.726—levels last seen in mid-November 2024.

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