With Bitcoin’s astronomical surge, the crypto market has seen an overall uptrend, touching a new mark in global market capitalization. However, with each passing day, investors are witnessing the rise and fall of several altcoins, and one such cryptocurrency that has been caught under intense bearish dominance lately is Cardano. Although it has brought many developments to the platform including DJED stablecoin and Valentine upgrade, the token has failed to join the market bull run and is currently underperforming.
Why is Cardano underperforming?
Despite its promising technology and a growing community of supporters, Cardano has underperformed in the crypto market. There are several reasons why Cardano has underperformed in recent months.
First, Cardano faced fierce competition from other cryptocurrencies. Bitcoin and Ethereum, the two largest cryptocurrencies by market cap, saw significant growth, and other cryptocurrencies like Binance Coin and MATIC outperformed Cardano.
Second, Cardano has been criticized for being slow to develop. The platform has been developing since 2015 but still hasn’t rolled out all the promised features. This caused some investors to lose faith in the project and switch to other cryptocurrencies for better returns during the bull run.
Third, Cardano has been criticized for its lack of real-world use cases. Although the platform promises to be more efficient and secure than other blockchain platforms, it still has not been widely adopted by businesses and governments, making it a less preferable investment option. in the crypto market.
As a result, Cardano investors seem to be experiencing a significant amount of bad luck in the crypto market for the past few weeks. Despite hitting a high of $3, the digital asset is struggling to even reach $0.5 as it has repeatedly dropped below weekly lows. Consequently, this led to a decline in profitability, which led many investors to find themselves in a loss position.
ADA price fails to maintain its uptrend
As Bitcoin (BTC) approaches the $30,000 mark, altcoins are struggling to keep up, and Cardano’s price movement was no exception. Like other altcoins, it has seen only a modest 12% increase since March 1 and is currently trading at $0.35.
For medium to long-term investors, the support set at $0.25 serves as a downward control point for the price of Cardano. On the other hand, the checkpoint at $0.40 is likely to limit the growth of ADA or, if exceeded, can potentially drive the token towards the $1 mark.
Analyzing the daily price chart, Cardano’s ADA (ADA) is currently facing resistance from the bears at the 200-day SMA ($0.36), while the bulls are taking advantage of the dips and buying at the EMA of 20 days ($0.34). If the ADA price breaks below $0.32, it may trigger a severe drop to $0.22.