invezz.com 
Cardano ($ADA) continues to trade in the red on Friday, holding just above an important support zone after losing more than 8% this week.
Weak derivatives positioning, cautious on-chain signals, and fading momentum point to a bearish near-term outlook.
A decisive close below the support cluster between $0.195 and $0.200 could trigger a deeper correction toward $0.173.
Cardano derivatives traders turn bearish
Cardano’s derivatives market indicates that traders are increasingly positioning for further losses.
$ADA’s long-to-short ratio stood at 0.93 on Friday, approaching its lowest level in a month, according to CoinGlass.
A reading below 1 means short positions outnumber longs, reflecting expectations that Cardano’s price could decline.
The imbalance suggests that leveraged traders remain cautious despite $ADA’s modest recovery from its weekly lows.
Cardano’s funding rate also turned negative on Friday, falling to -0.0006%. Negative funding means traders holding short positions are paying those with long positions.
The reading signals stronger demand for bearish exposure and reinforces the negative message from the long-to-short ratio.
If funding remains negative while $ADA approaches support, the market could experience greater volatility.
However, heavily concentrated short positioning could also create conditions for a short squeeze if the price rebounds sharply.
CryptoQuant’s market summary also presents a cautious outlook for Cardano. Large whale orders are appearing in $ADA’s futures market, indicating that major traders remain active.
However, both spot and futures markets are showing signs of increased activity or “heating” while several other metrics remain neutral.
Together, these readings suggest that Cardano traders are becoming more active but have not established a convincingly bullish direction.
Cardano technical outlook: $ADA holds above 50-day and 100-day EMAs
Cardano is trading around $0.202 on Friday after falling more than 8% since the beginning of the week.
Despite the correction, $ADA remains above its 100-day EMA at $0.200 and 50-day EMA at $0.198.
These moving averages provide an immediate cushion and preserve a neutral to slightly constructive technical structure. However, the broader trend remains constrained by the 200-day EMA near $0.241.
The Relative Strength Index sits just below 50, signaling balanced momentum between buyers and sellers.
Meanwhile, the Moving Average Convergence Divergence indicator remains slightly negative and below its zero line, showing that bullish momentum is weak.
$ADA’s first upside barrier is the 50% Fibonacci retracement at $0.213. A break above this level could allow buyers to target the 61.8% retracement at $0.231.
Stronger resistance sits between $0.236 and $0.245. This zone includes the 200-day EMA at $0.241 and could present a substantial challenge for buyers.
Cardano would need to secure a sustained close above this resistance cluster to signal a more convincing bullish trend reversal.
On the flipside, Cardano’s immediate support zone extends from the 100-day EMA at $0.200 to the 50-day EMA at $0.198.
The 38.2% Fibonacci retracement at $0.195 reinforces this demand area. A decisive close below the zone would weaken $ADA’s technical structure and increase the risk of a move toward $0.173.
If selling pressure intensifies, the next major horizontal support sits near $0.150.
