Cardano (ADA) extended its recent decline after analyst Ali Martinez identified three bearish signals spanning whale activity, on-chain valuation, and technical indicators. ADA, the native token of the Layer-1 blockchain founded by Charles Hoskinson, has struggled to maintain momentum amid a broader cooldown in large-cap alternative cryptocurrencies following midsummer rallies.

According to CoinGecko, ADA traded near $0.162 after breaking below the $0.170 support level that Martinez had previously flagged. The token recorded a 24-hour range between $0.1604 and $0.1683 and was down approximately 7% over the preceding seven days. Despite the pullback, ADA still held a 15% gain over the past 30 days, reflecting the magnitude of its earlier August surge and the subsequent unwinding of those gains.

Whale Wallets Decline Following Early August Rally

Cardano whale activity has softened since the beginning of August. Martinez tracked wallets holding between 1 million and 10 million ADA, finding that the count dropped from 2,370 on August 2 to 2,340. The reduction followed ADA's climb to roughly $0.2107, which allowed large holders to lock in gains or redistribute tokens.

Martinez attributed the shrinking wallet count to possible profit-taking after the recent price advance. ADA subsequently fell below $0.19, indicating that buyers were unable to sustain the token near its early August peak. Reduced participation from large wallets may also leave the market with thinner support should broader selling pressure intensify. Whale-wallet tracking has become a widely used lens in crypto markets, where concentrated holdings among large addresses can amplify price swings compared with more broadly distributed assets.

MVRV Death Cross Adds to Bearish Case

Cardano's Market Value to Realized Value (MVRV) ratio has also deteriorated. Martinez reported that ADA's MVRV ratio formed a death cross with its seven-day simple moving average. The MVRV ratio compares an asset's market value against the average acquisition cost of its holders, and a declining reading can signal softer momentum following a strong price move. The metric is one of several on-chain valuation tools that analysts use to gauge whether an asset is trading above or below the aggregate cost basis of its holder base.

The crossover coincided with the drop in whale balances, providing a second bearish measure. Over the past 24 hours, ADA declined 1.8%, while the previous week saw a 4% loss.

Related analysis from Martinez on X

TD Sequential Sell Signal Emerges on Daily Chart

The TD Sequential indicator on Cardano's daily chart produced a sell signal. Martinez noted that the reading could precede a pullback lasting one to four daily candlesticks and may initiate a fresh bearish countdown if selling pressure persists. The indicator, developed by market technician Tom DeMark, is designed to identify potential exhaustion points in trending assets and is widely followed across crypto and traditional markets.

The signal followed ADA's earlier rally above $0.21 and its subsequent correction. Martinez did not view the indicator in isolation as confirmation of a deeper decline; rather, he combined it with the falling whale wallet count and the MVRV crossover to build his bearish thesis.

$0.170 Broken — $0.144 Becomes the Next Focus

Martinez had initially identified $0.170 as the first downside target. With ADA now trading near $0.162, that level has shifted from support to resistance. The next major downside zone in his analysis sits near $0.144, representing the lower boundary of the trading structure on his chart.

A move from $0.162 to $0.144 would amount to roughly an additional 11% decline. A decisive break below $0.144 would further weaken the existing structure and force traders to look for lower support levels.

On the upside, the bullish invalidation scenario begins with ADA reclaiming $0.170. Beyond that, stronger resistance sits around $0.186, followed by the prior recovery zone near $0.20–$0.21.

For now, the convergence of declining whale-wallet counts, weakening MVRV momentum, and the TD Sequential sell signal continues to weigh on Cardano's price.

Disclaimer: This article is for informational purposes only and does not constitute financial or investment advice. Cryptocurrency markets are highly volatile. Readers should conduct their own research and consult a licensed financial advisor before making investment decisions.