This is why Cardano whales are panic selling

• Cardano price seems to be holding the line after a 57% crash to $0.384.
• Any further recovery is limited to the immediate hurdle at $0.677.
• A daily candlestick close below $0.397 will invalidate the already shaky bullish thesis.

Cardano price is hovering well above the recent swing low that marked the potential bottom. This recovery, while impressive, is likely to be limited due to multiple hurdles and bearish on-chain metrics.

Cardano price needs to prove its worth

Cardano price has crashed 57% from May 6 and 87% from its all-time high at $3.11. The last leg of this massive downswing was due to the UST-LUNA fiasco that sent the market crashing. The recent move south seems to have stabilized after tagging the $0.397 support floor. 

Since then, Cardano price has recovered 47% to where it currently trades – $0.55. While this move is nothing short of impressive, any further rise in the uptrend seems unlikely due to the suite of hurdles present ahead.

The immediate resistance barrier at $0.677 is likely to be the local top for Cardano price and is where the upside could be capped. Beyond this barrier, the $0.785 and $0.900 are two significant barriers that could stop bullish momentum dead in its tracks.

ADA/USDT 1-day chart

Further supporting the bearish outlook for Cardano price is the behavior of whales as seen in the supply distribution chart. The investor group that has 10,000 to 100,000 ADA tokens have been offloading its holdings since April 10. This category dropped from nearly 22,500 to 20,500, denoting an 8.8% slump.

The same trend was observed with whales holding 100,000 to 1,000,000 ADA tokens. These investors went from 127,600 to 121,500, representing a 4.7% downtick. The most significant set of holders that accumulate between 1 million to 10 million ADA tokens have declined from 2,589 to 2,540 in the last two weeks or so.

Regardless of the number of tokens they hold, the whales have been selling for quite some time. This development indicates that the long-term holders are losing trust in the project and therefore the performance of ADA.

ADA supply distribution 

While things are looking up for Cardano price, a daily candlestick close below $0.397 will invalidate the already shaky bullish thesis by producing a lower low. In such a case, ADA might crash another 22% to $0.307.