Cardano Sees a Sentiment Shift: Is This an Early Sign of a Rebound?

• Cardano’s bearish sentiment may signal an opportunity for whales to accumulate and drive future upside.
• Technical setup suggests a possible breakout if ADA holds key support and closes above the channel.

Public sentiment toward Cardano (ADA) has recently begun to waver. A report from Santiment states that typically optimistic ADA holders are starting to show pessimistic tendencies.

This negative sentiment level is the lowest it has been in five months. Yet, oddly, amid this gloomy climate, the price of ADA saw an increase at that time. Furthermore, when small traders start to panic and sell their assets in frustration, it’s the larger holders who are quietly accumulating.

This phenomenon, while seemingly counterintuitive, often occurs in the crypto market. When the crowd begins to lose hope, that’s often when the price begins to quietly rise.

And that’s why Santiment states that “prices often move in the opposite direction of crowd expectations.” So, it could be that those who were patient and held ADA during the downtrend over the past three weeks might be smiling later.

Hovering Near Support, but Is a Rally on the Cards?

From a technical perspective, analyst LingridLingrid notes that ADA briefly touched the same support zone as the beginning of the previous price surge. The chart now shows that ADA is moving within a narrowing descending channel.

Typically, if a pattern like this breaks upwards, the potential for a surge to the $0.95 to $1.00 range becomes clear. But of course, it’s not that simple. If the price falls back below the channel, the consolidation phase will be even longer and more tedious.

At the time of writing, ADA is changing hands at about $0.8191, down 5.59% over the past 7 days, with a $29.27 billion market cap.

Meanwhile, Bitcoin’s dominance has risen to 57.73%, indicating capital flows are slowly shifting away from altcoins like ADA. It’s fair to say that the macro environment for crypto is also less favorable.

Furthermore, news of Grayscale’s proposed Cardano ETF is still stalled at the SEC. This would have been a highly anticipated positive catalyst.

Cardano’s Fundamentals Stir Debate Amid Bold Growth Claims

On the other hand, fundamental factors have also been highlighted. In early August, the CNF reported that the Cardano Foundation and IOTA had jointly responded to discussions about crypto asset regulation by UK authorities.

They welcomed the FCA’s fair approach, but raised concerns about the leveling of traditional, centralized platforms and fully decentralized systems. This wasn’t just a legal opinion, but could impact how Cardano is regulated in the future.

Besides that, Charles Hoskinson’s statement last July also caused a stir. He asserted that because ADA’s market cap is still relatively small, its potential for growth is much higher than Bitcoin’s. He even mentioned growth figures of 100x to 1,000x—which, to some, might sound like a pipe dream.