Cardano price is trading at a deep discount. Since the beginning of December, the price has fallen nearly 45%, recently hitting $0.26, but has since rebounded to near $0.28. On paper, this looks like a strong buy zone.
The chart also shows an early reversal signal. Individual traders are starting to accumulate again. But large holders known as whales remain wary. Despite the discount and improving indicators, there is a lack of conviction in buying. Three data points explain why.
Bullish divergence within the falling Straits still does not unite the whales
Technically speaking, Cardano’s charts seem to be mixed.
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Since November, ADA has been trading within a descending channel, with the price cutting lower highs and lowering lows in parallel lines. This reflects a controlled downtrend rather than panic selling as the channel remains intact. Still, downside risks still remain.
At the same time, momentum is increasing.
Between November 21st and January 31st, ADA formed an even lower low. During the same period, the Relative Strength Index (RSI) hit new highs. RSI measures momentum on a scale of 0 to 100. If the RSI is rising while prices are falling, it suggests that selling pressure is easing. This is known as a bullish divergence. This usually appears near an initial trend reversal.
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But despite the reversal signs, the whales are not responding in a unified manner.
On-chain data shows that the three major wallet groups behave differently.
Wallets with over 1 billion ADA have increased their holdings slightly since January 28th, but did not increase anything during the fall at the end of January. Wallets holding between 100 million and 1 billion ADA decreased their holdings from approximately 2.58 billion to 2.47 billion. Wallets holding ADA from 10 million to 100 million increased their holdings from approximately 13.37 billion to 13.5 billion.
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These groups usually gather together when whales strongly believe in rebounding. That’s not happening. Net purchasing power is only 20 million ADA. The reason is risk.
As long as ADA remains near the lower end of the descending channel, a breakdown remains possible. The potential for a further 29% decline if the break is confirmed was highlighted later in the price discussion. This structural risk keeps large investors on the defensive, even as bullish divergences form.
Weak social control and the momentum of prudent retail purchasing restrictions
The second barrier is emotion.
Social dominance measures how much attention a coin attracts compared to other cryptocurrency markets. This tracks the share of online discussions focused on that asset. Rising dominance often indicates increased speculation and inflows.
In the case of Cardano, social dominance peaked at nearly 1.08% in November 2025, when the ADA price reached $0.59. It has been in steady decline ever since. It is currently hovering around 0.047%, close to its lowest level in several months.
Historically, this is important.
The community peaked in early December, prior to the 12% rise. It peaked again in late December, rising 16%.
As social interest increases, prices often follow. Interest is waning now. Without narrative momentum, whales have little incentive to scale up to positions. Retail behavior has become more positive, but remains cautious.
ADA has been recording net outflows from the exchange every day since January 22nd. Outflow means coins leave an exchange, usually for the purpose of holding rather than selling. This reflects buying pressure.
Net buying amount per day reached nearly $14.9 million on January 31st, but has since fallen to about $2.8 million. There have been no major selling days since late January.
This shows that retail investors are slowly accumulating momentum. But the pace is modest. Without increased public attention, retail demand alone cannot drive strong trends.
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Smart Money Weaknesses and Key Cardano Price Levels Keep Whales Defending
The final caveat comes from “smart money” and pricing structure.
The Smart Money Index tracks how experienced traders take positions during various market hours. It is intended to reflect informed action, not emotional trading.
Recently, this index has been falling below the signal line. In past bull markets, stocks often rose before prices in early January. The current weakness suggests that professional traders are not yet poised for a rebound. This also strengthens the vigilance against whales.
From a technical perspective, several levels currently define the outlook for February.
On the upside, ADA must first regain $0.319. This may indicate an increase in self-confidence. A break above $0.376 is more important. It will destroy the descending channel and move the structure from bearish to neutral. That could attract coordinated whale purchases.
On the downside, $0.268 remains important. A confirmation below this level would also confirm the channel breakdown and open the downside towards $0.188, implying a 29% downside target from the breakdown point.
As long as the price is between $0.268 and $0.319, uncertainty reigns. A bullish divergence indicates that selling pressure is waning. But convictions remain low due to weak social momentum, fragmented whale behavior, and a lack of prudent funding. Until sentiment improves and key resistance levels break, a rebound in Cardano remains possible, but unproven.
