Have you ever watched a coin that feels like it’s perpetually stuck in second gear? That’s been Cardano for what seems like forever. Yet something interesting is happening right now, in early December 2025, that actually has me paying closer attention than usual.
ADA is doing that classic thing where everything looks terrible on the surface, but under the hood a few indicators are starting to whisper that maybe, just maybe, the bleeding is close to being over. I’ve been around crypto long enough to know these whispers can turn into screams or just fade away completely. So let’s dig in and see what’s really going on.
Cardano Is Flirting With a Reversal – But Don’t Get Too Excited Yet
Let’s start with the part that actually made me raise an eyebrow. The daily RSI has climbed back into the low 40s after spending a painful amount of time in oversold territory. That’s not exactly screaming bull market, but it’s a clear reduction in selling pressure. More importantly, if you zoom out to the monthly chart, there’s something pretty rare forming.
We’re seeing what looks like the first proper bullish RSI divergence on the monthly timeframe since March 2020. Yeah, you read that right – 2020. These setups don’t come around often, and when they do, they deserve respect. The catch? It stays valid only as long as we don’t close a monthly candle below roughly $0.34. Considering where we are right now, that’s a pretty wide safety net.
The EMA Situation Is Getting Interesting
One of my favorite pre-movement signals is when shorter-term exponential moving averages start compressing against longer ones. Right now the 9-day EMA is beginning to curl upward while the 20-day EMA is still pointing down. The gap between them is narrowing fast.
In my experience, this compression phase is like watching a spring getting coiled. Something has to give eventually – either we get a explosive move up, or the bears crush it back down. But the fact that the shorter average is trying to cross higher for the first time in ages definitely counts as a bullish tilt in the short term.
MACD Is Doing Something It Hasn’t Done in Months
The MACD histogram has been expanding positively for multiple consecutive days now. Yes, we’re still below the zero line – the broader trend remains bearish for the moment – but the histogram bars are getting taller in the green direction. This is textbook building momentum.
I’ve found that when you combine this kind of histogram expansion with RSI recovering from oversold levels and EMA compression, you often get at least a decent bounce. The question is whether this bounce has the strength to become something more meaningful.
The quiet periods where indicators align like this are often when the smartest money starts positioning. Most retail traders are still angry about the drawdown and miss the setup entirely.
Support Held – But Barely
Let’s talk about price action itself because that’s ultimately what matters. Cardano has been defending a zone around $0.38-$0.39 with what honestly looks like its last breath on several occasions. Each time the bears pushed, buyers stepped in and absorbed the selling.
This isn’t the kind of violent V-shaped recovery that screams new bull market, but it’s also not the clean breakdown many were expecting. In trading, when everyone is positioned for the obvious move and it doesn’t happen, that’s often when the market decides to do something different.
The Massive Resistance Problem Nobody Wants to Talk About
Here’s where the bears still have a very strong case. If you pull up the order book data (and you absolutely should be doing this regularly), what you see above current price is frankly terrifying from a bull perspective.
There are multiple thick ask walls stacked between $0.45 and $0.50, with the heaviest concentration right around that 20-day EMA that keeps rejecting price. This isn’t just random resistance – this is where a lot of trapped bag-holders from the previous run-up are sitting, desperate to get out even or with minimal losses.
- First major wall sits around $0.45 – coincides perfectly with the descending 20-day EMA
- Second cluster around $0.47 where we saw massive volume during the November rejection
- Final big one near $0.50 psychological level that also aligns with the 50-day EMA
These aren’t small walls either. We’re talking hundreds of millions worth of sell orders waiting to get hit. For Cardano to sustain any real upside, bulls need to plow through all of this, and that’s asking a lot in the current market environment.
What the Bid Side Tells Us
Interestingly, the bid side actually looks pretty healthy. There’s a massive bid wall sitting just below current price that has been growing rather than shrinking. This suggests that whatever selling we’ve seen recently has been absorbed by patient buyers who believe we’re close to a bottom.
This dynamic – strong bids below, heavy asks above – creates what traders call a “liquidity trap” setup. Price gets squeezed in an increasingly tight range until one side gives up. These periods can be incredibly frustrating to trade, but they often precede big directional moves.
Two Very Different Scenarios Playing Out
At this point, I see two primary paths forward, and both are completely plausible given the current setup.
Scenario 1 – The Bull Case (My Personal Bias Right Now): We get a slow grind higher as the ask walls get eaten gradually. The monthly bullish divergence plays out over the next 2-3 months, and Cardano reclaims $0.60+ by early 2026. This would require Bitcoin to at least remain constructive, which feels likely given current macro conditions.
Scenario 2 – The Bear Trap: Price gets rejected hard at $0.45-0.47, the bid wall below finally cracks, and we cascade down to test $0.27-0.30 where the next major support sits. This would invalidate the monthly setup and likely take us into a much longer bottoming process.
Right now the probability feels roughly 60/40 in favor of the bull case, but that’s purely based on the indicator alignment and order book dynamics I’m seeing. A lot can change quickly in crypto.
Why This Matters Beyond Just ADA
Cardano often acts as a bellwether for the “smart contract platform” narrative outside of Ethereum and Solana. When ADA moves, other layer-1 tokens tend to follow. A sustained breakout here could signal that money is rotating back into the higher-quality altcoins rather than just staying in memes and Bitcoin.
Conversely, if Cardano fails at this resistance and breaks down, it’s probably a warning sign that risk appetite is deteriorating across the board. These are the kinds of moves that matter for portfolio construction decisions.
Look, I’ve been wrong about Cardano more times than I care to admit. This is a project that consistently underperforms expectations while somehow maintaining a top-10 market cap through pure stubbornness and a very dedicated community.
But the technical setup right now is genuinely one of the more constructive ones we’ve seen in years. The combination of monthly bullish divergence, daily momentum indicators turning up, and strong bid support below current price creates a scenario where the risk/reward actually favors longs for the first time in a long while.
The resistance overhead is real and substantial. Breaking through it would require real conviction and volume. But if you’re the type of trader who likes to position before the crowd figures it out, this feels like one of those moments where paying attention might actually pay off.
Just remember – in crypto, being early is often indistinguishable from being wrong. Until we see confirmed closes above $0.47-0.50, the bears still have the structural advantage. But the bulls are finally showing up to the fight, and that alone makes this worth watching closely over the coming weeks.
