Cardano (CRYPTO: ADA) rose about 5% on Wednesday to trade near $0.54, as traders positioned for a potential rebound.
Price Finds Support But Faces Heavy Resistance
ADA Price Action (Source: TradingView)
Cardano is attempting to stabilize near the $0.52–$0.50 demand zone after briefly dipping below it earlier this week.
Buyers stepped in quickly, highlighting that this area continues to attract defense.
Despite the bounce, ADA remains trapped beneath a descending trendline drawn from its September peak, keeping the broader structure bearish.
All major EMA's are stacked above price between $0.6260 and $0.7427, forming a dense resistance cluster that has repeatedly rejected rallies.
The Supertrend indicator also remains red, reinforcing that sellers still control momentum.
Until ADA closes decisively above these EMAs, each recovery attempt risks turning into an exit opportunity for trapped holders.
Spot Flows Reflect Ongoing Distribution
ADA Netflows (Source: Coinglass)
Exchange data from Coinglass shows persistent negative netflows throughout October and early November, meaning more ADA has been sent to exchanges than withdrawn to custody wallets.
Although the latest reading flipped slightly positive at $1.61 million, it does not reverse the broader pattern of distribution.
Sustained red flows typically coincide with downtrends and indicate that traders are using price strength to sell rather than accumulate.
Long-term buyers remain cautious, signaling that conviction in a lasting reversal is still weak.
Derivatives Traders Bet On A Short-Term Rebound
ADA Derivative Analysis (Source: Coinglass)
Open interest in ADA futures rose 9.31% over the past 24 hours to roughly $655 million, while trading volume jumped more than 60% to $2.91 billion.
The data suggests traders are positioning for volatility around the current support.
Retail sentiment has tilted bullish, with long/short ratios showing more longs entering positions, while top traders remain relatively balanced.
If ADA fails to sustain its current rebound, those leveraged long positions could unwind quickly, leading to another wave of downside pressure.
Key Levels Define The Next Move
Two critical zones now define ADA's short-term path.
The support band between $0.52–$0.50 must hold to prevent a breakdown toward the next liquidity pocket near $0.40–$0.30, which marked the accumulation zone earlier this year.
On the upside, the descending trendline remains the first test, followed by a reclaim of the 20-day EMA.
A close above both would begin shifting control back to buyers and signal a potential trend reversal.
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