TLDR
- Cardano is forming a bullish RSI divergence pattern similar to one that triggered a 32% rally in late 2025
- Whales accumulated 100 million ADA worth over $36 million between January 12-19, while long-term holder selling dropped 99%
- Short-term holder activity surged 312%, introducing potential supply pressure if price bounces
- ADA must reclaim $0.41 and the 50-day EMA to confirm the bullish setup; failure risks dropping to $0.35
- Despite overwhelmingly bullish sentiment following Charles Hoskinson’s Clarity Act criticism, ADA dropped 7% to $0.36
Cardano is showing signs of a technical setup that previously led to a 32% price increase. The pattern involves a bullish divergence on the daily chart, where ADA makes a lower low while the Relative Strength Index trends higher.
This same formation appeared between November 4 and December 31, 2025. During that period, the divergence signaled weakening selling pressure and preceded a rally. A similar structure is now developing between November 4, 2025, and January 19, 2026.
The RSI measures recent gains against recent losses to assess momentum. When price drops but RSI rises, it suggests sellers are losing strength.
Large wallet holders are supporting the currenst setup. Addresses holding between 1 million and 10 million ADA increased their holdings from 5.51 billion to 5.61 billion ADA since January 12. This 100 million ADA increase represents about $36 million at current prices.
This type of accumulation typically happens before price movements rather than after them. The whale buying occurred as the technical pattern began forming.
Long-Term Holders Stay Inactive
Long-term holder behavior is adding to the bullish case. Wallets holding ADA for 180 to 365 days reduced their on-chain activity by more than 99%. Their spent coin activity dropped from 67.47 million ADA on January 14 to around 174,000 ADA recently.
This sharp decline means long-term holders are not selling during the current weakness. Their inactivity provides downside support and reduces panic selling risk.
Short-term holders are showing different behavior. Coins held for 30 to 60 days became more active as the pattern formed. Spent coin activity for this group jumped from 3.6 million ADA on January 18 to 14.84 million ADA, a 312% increase.
This creates a mixed signal. While long-term holders provide support, rising short-term activity could introduce selling pressure if the price begins to recover.
The Chaikin Money Flow indicator is trending higher even as price has moved lower. This suggests capital has been entering the asset during the recent decline. Previously, CMF failed to stay positive during rallies, but this time it has remained above zero.
Price Levels to Watch
The previous 32% rally failed because ADA could not reclaim the 50-day exponential moving average. That level now sits near $0.41 and represents the first test for any upcoming bounce.
$ADA is consolidating near the lower border of the descending channel formation on the 3D chart
Expecting a bounce soon.
Potential move ~ 50%#Crypto #Cardano pic.twitter.com/Mls2BkZLtb— INSIDER (@x_insider4) January 17, 2026
A daily close above $0.41 would signal that short-term momentum is aligning with the technical setup. Above that level, $0.43 becomes the next resistance point.
The 200-day EMA sits near $0.48 and would mark a more meaningful trend shift if reached.
On the downside, a break below $0.35 would weaken the bullish divergence. That would reopen the path toward $0.32 and delay any potential rally.
Recent sentiment around Cardano turned bullish after founder Charles Hoskinson criticized the Digital Asset Market Clarity Act. He raised concerns about KYC requirements and DeFi restrictions in the bill during a broadcast on January 18.
📊 There was a massive spike in bullish sentiment toward Cardano yesterday, followed by an immediate price drop. This was related to founder Charles Hoskinson's interview where he, among other topics:
📌 Expressed his concerns over the CLARITY Act
📌 Criticized Ripple CEO Brad… pic.twitter.com/7xVFbTcdtf— Santiment (@santimentfeed) January 19, 2026
His comments about Ripple CEO Brad Garlinghouse supporting the legislation triggered community discussion. Market intelligence platform Santiment reported that bullish commentary outweighed bearish views by a ratio of 27 to 1.
Despite the surge in positive sentiment, ADA dropped 7.69% from $0.39 to $0.36 on January 19. The decline coincided with broader market selling pressure related to tariff announcements targeting the U.K. and European countries.
ADA briefly recovered to $0.37 before sliding back to around $0.3662. The price action demonstrates that market conditions can override sentiment shifts.
