Cardano's native token ADA fell 1.97% over the past 24 hours to $0.262, extending the asset's recent downward trajectory. ADA has declined over 9% in the past week and is down 32.67% over the past 6 months, significantly underperforming the broader crypto market. With Cardano's market cap standing at $9.17 billion, let's analyze the key metrics behind ADA's bearish momentum and what they might indicate for future price action.

In the past day, trading volume for ADA was $146.80 million, suggesting waning interest among traders. Over the past hour, ADA staged a small 0.08% recovery, but this marginal uptick did little to reverse the overriding negative sentiment. Zooming out shows ADA has plunged 16.25% in the past month as sellers maintained control.

Cardano's market capitalization currently ranks it as the 8th largest cryptocurrency, down from a high of 3rd just last year. This drop in the rankings and erosion in market cap indicates ADA has been falling out of favor compared to rival smart contract platforms like Ethereum and Solana.

Drilling down, ADA has plunged a whopping 32.67% over the past 6 months, dramatically underperforming Bitcoin and the broader altcoin market. This horrendous return highlights how much downside momentum Cardano has recently acquired. Contributing factors likely include network congestion issues and delays in key protocol upgrades.

My analysis suggests further declines for ADA look likely in the near-term. The technical chart has turned decisively bearish, with ADA breaking below both its 50-day and 200-day moving averages. These breakdowns often precede further selling pressure as support levels give way. I expect ADA will test the $0.20 level soon, with the possibility of wicking as low as $0.15 if panic sets in.

Bulls will need to see a sharp reversal back above $0.30 in the next few weeks to neutralize the bearish technical outlook. Even then, ADA will likely encounter stiff resistance near $0.40, which has capped price advances multiple times in 2022. Only a sustained breakout above this level would signal an interim bottom is likely in.

Until Cardano can address its network scalability issues and finally ship its long-awaited Vasil upgrade, further declines look probable for ADA. The development team needs to execute or risk ADA falling into irrelevance versus competitors. Monitor price action at the $0.20 support level where bulls must defend.

Should You Buy Cardano After the Recent Decline?

Following Cardano's steep 32% drawdown over the past 6 months, bargain-hunting investors may be wondering if now is the time to pick up ADA on the cheap. While the blockchain's long-term prospects remain bright, the recent technical breakdown suggests caution is warranted before buying this falling knife.

Though Cardano has promising technology, it has yet to gain significant developer adoption or user activity. Congestion and scaling issues have also plagued the network, calling into question ADA's ability to become a viable Ethereum alternative. Until the Vasil hard fork is released to boost throughput, doubts will persist.

Additionally, ADA remains highly correlated to broader crypto market moves, indicating speculative flows rather than project fundamentals are driving price action. This makes a sustainable bottom difficult, as Bitcoin would likely need to bottom first before ADA can mount a recovery.

That said, once the macro backdrop improves, ADA's strong staking rewards and discounted price could make it an attractive opportunity. But prudent investors may want to wait for definitive technical signs of a bottom before initiating a long-term position. Look for a break above resistance at $0.40 and successful defense of the $0.20 floor first.

What's Next for Cardano if Prices Fall Below $0.20?

Cardano's ADA token looks vulnerable to a decline below its critical support level around $0.20 if current bearish momentum persists. If the $0.20 floor gives way, what are the next key levels ADA bulls must defend to avoid capitulation?

The most immediate support zone sits between $0.10 and $0.15. This area represents the final backstop before a retest of ADA's all-time low around $0.03. Bulls will try to make a last stand here to prevent a complete collapse. However, if selling pressure is unrelenting, a drop toward $0.03 looks inevitable.

Below $0.03, very little meaningful support exists until Cardano reaches the $0.01 level. Given how rarely assets revisit all-time lows, many view sub-$0.03 prices as unlikely. But capitulation events have a way of overshooting even the most bearish targets. A spike below $0.01 can't be ruled out.

Bulls will need to see massive buying volume come in around $0.20 to avoid this bearish outlook. What Cardano needs now is renewed investor enthusiasm and delivery on long-promised upgrades. Otherwise, stalling user growth and network issues will continue weighing on ADA.

Yet with fear so elevated, a short-term relief rally up to $0.30 could happen at any time. Traders should look for bullish RSI divergences or a statistically oversold bounce on heightened volume. While further downside is possible, brave investors may have an opportunity soon to buy ADA near the bottom.