Cardano's (ADA) price has been on a downward trend lately. This has raised concerns about a potential drop below the $1 support level.

A big reason for this decline is the selling activity by large ADA holders, often called "whales." These investors have been offloading their coins, likely to cash in on recent gains.

According to BeInCrypto's analysis, these whales have sold a significant amount of their holdings in the past week. Data from Santiment shows that large holders—those with between 100 million and 1 billion ADA—have distributed coins worth $200 million over the last seven days.

When large holders sell, it often signals reduced confidence in the asset. This creates significant selling pressure in the market, which can lead to price drops. If there isn’t enough demand to absorb these large sell-offs, it can push prices down even further. This situation might also trigger panic selling among smaller investors, adding more pressure on the price.

Additionally, the recent profitability of ADA transactions has contributed to these sell-offs. Santiment's data indicates that the Network Realized Profit/Loss for ADA has been positive over the past week. This suggests that traders have been selling for profit, which may have encouraged other investors to do the same to lock in their gains.

Currently, ADA is trading at $1.02, just below the resistance level at $1.07. If sell-offs continue, attempts to break through this resistance may fail. This could lead to a decline below the $1 zone, possibly down to $0.92.

On the flip side, if ADA successfully breaks through that resistance, the price could rise to its two-year high of $1.34, last achieved on December 3.