The popular altcoin Cardano closed June with a 16% price drop, continuing its downward trend for several months. This decline occurred despite major ecosystem milestones recorded during June.
As July begins, with a still lacking positive atmosphere, ADA may face additional downward pressure in the short term.
Despite Cardano Ecosystem Growth... Why is ADA Price Struggling
On June 14, Cardano founder Charles Hoskinson announced network expansion plans. This is an interoperability stage aimed at full integration with the XRP ecosystem to strengthen cross-chain liquidity.
Subsequently, on June 25, major cryptocurrency exchange Coinbase released cbADA. This is a wrapped version of ADA, launched on Coinbase's Layer 2 network, Base. This move was designed to allow ADA holders to participate in decentralized applications (dApps) within the Coinbase ecosystem while remaining connected to Cardano.
However, despite these developments, ADA's price performance remains poor. According to Coinglass data, the coin has recorded consistent weekly outflows in the spot market since February, indicating sustained selling pressure and decreased investor interest.
During June, ADA's weekly outflows in the spot market reached $182.1 million due to a sharp decline in altcoin demand. When assets experience such steady spot outflows, traders and investors are withdrawing funds due to a lack of confidence in short-term price increases.
With fewer active market participants and continuous selling exceeding demand, ADA may struggle to find strong support and has a high probability of additional price decline in July.
Moreover, according to on-chain data, the proportion of ADA supply in profit continues to decrease. At the time of reporting, this was 45.97%, a 27% drop from the previous month.
This indicator serves as a proxy for market sentiment. When fewer holders are in profit, buyers' confidence weakens, leading to less aggressive purchases and additional decline risks.
ADA Struggles with Selling Pressure
The Elder-Ray index on the daily chart confirms the market's bearish intensity. The momentum indicator has consistently shown red bars since June 12, indicating strong seller dominance. At the time of reporting, ADA's Elder-Ray index is -0.0204.
If sellers continue to dominate the market, the price could drop to $0.52.
However, if the mood shifts and new developments within Cardano reignite demand, the price could rise to $0.59 as July progresses. Breaking through this resistance level could push Cardano's price to $0.64.
