Cardano (ADA) Nears First 2025 Death Cross: Bearish Signal Ahead?

Cardano (ADA), the ninth-largest cryptocurrency by market cap, is approaching a technical indicator known as a "death cross" — a bearish signal that could point to further downside. A death cross occurs when the 50-day simple moving average (SMA) drops below the 200-day SMA, suggesting weakening short-term momentum.

As of now, ADA’s 50-day SMA sits at $0.74 and is trending downward, while the 200-day SMA stands slightly lower at $0.734. If the crossover occurs, it will mark the first death cross for ADA in 2025. This pattern often indicates potential for a sustained downtrend, though it's not always a guaranteed predictor of future price movements.

ADA has struggled since hitting $1.19 on March 2, a high that followed the announcement of a strategic crypto reserve. Broader macroeconomic concerns and a market-wide sell-off contributed to its steady decline. At the time of writing, ADA was trading at $0.647, up 2.71% over the past 24 hours, extending a two-day recovery after the April 2 drop.

While technical signals like the death cross can shape trader sentiment, historical data shows varied outcomes. A golden cross in November 2024 led to a rally toward $1.32 in December. Conversely, the last death cross in May 2024 preceded a drop to $0.277 before ADA stabilized.

Traders are closely watching the current price action to assess if a similar downturn could follow. As always, market reactions to technical patterns can be influenced by external factors, including macroeconomic developments and investor sentiment. With Fed Chair Jerome Powell highlighting an uncertain economic outlook, crypto markets may remain volatile in the short term.