Increasing Short Positions in Cardano: What Should You Do with Your ADA?

• Short positions taken against ADA have grown significantly.
• Activity on the Cardano network has also decreased materially.

Cardano [ADA] It has been one of the many coins that have not performed well in the past few weeks, compared to other tokens.

As a result, short positions taken against ADA increased. Over the past 12 hours, ADA has been the third most shorted token out of all cryptocurrencies.

Source: X

ADA’s decline began after March 27 after it tested the $0.6700 level. The price fell by 35% during this period, while showing several lower lows and lower highs, which were signs of a downtrend.

Over the past few weeks, there has been no sign of the ADA reversing. The CMF (Chaikin Money Flow) indicator also fell significantly. A lower CMF indicated that funds flowing into ADA had decreased.

In addition, the Relative Strength Index (RSI) for ADA also fell below 36, meaning that the bullish momentum around ADA has weakened materially.

Source: Trading Offer

Social activity is on the rise

On the social front, things were looking positive for the ADA. ADA’s social volume has remained steady over the past month, indicating that the token has been gaining traction on social media platforms.

Weighted sentiment about ADA also grew at the time of writing, meaning that positive comments about ADA outnumbered negative comments.

ADA’s popularity on social media may play a major role in a potential reversal in its price in the future.

Source: Santiment

How is ADA?

Speaking of the state of the token, it has been observed that the speed of ADA has decreased materially.

Surprisingly, despite the price drop, the number of ADA token holders continued to grow.

The growing number of ADA holders indicates that there may be some retail interest in the ADA token, however, it has not been significant enough to push the ADA price higher.

Source: Santiment

Read Cardano [ADA] Price forecasts 2023-24

The Cardano protocol also performed poorly. Over the past month, the number of daily transactions on the network has decreased from 90,000 to 45,000.

Besides, the number of daily active addresses on the network also decreased significantly from 70,000 to 29,000 during the same period.

Source: Artemis