The Midnight (NIGHT) market is showing clear differentiation: derivatives are exerting short-term downward pressure, while the spot money continues to accumulate and maintains an upward scenario.
The 24-hour trading volume of NIGHT has decreased significantly, but the data suggests this may be a capital rotation rather than a complete withdrawal. Indicators such as Open Interest, Funding Rate, A/D, and liquidation heatmap clarify which side is dominant in each time frame.
MAIN CONTENT
The trading volume of NIGHT decreased by 50% to 3.97 billion USD in 24 hours, reflecting weakened short-term sentiment.
Derivatives put pressure as Open Interest decreased by 12% and the Funding Rate weighted by OI turned negative.
Spot is still accumulating strongly; the liquidation heatmap shows a higher probability of pulling up to the liquidity zone above.
The volume and market capitalization of NIGHT indicate that short selling pressure is dominating.
In the past 24 hours, the trading volume of NIGHT decreased by 50% to 3.97 billion USD, while the market capitalization saw a net increase but still dropped from 1.94 billion USD to 1.52 billion USD in a day.
The decline in volume often accompanies a cautious sentiment and capital temporarily leaving the market. However, the context in NIGHT suggests that a 'rotation' phenomenon may be occurring as spot buying is still present while the derivatives side increases defensive positions.
The number of investors also fluctuated: from an all-time high of 6,880 down to 6,210, then continued to touch 6,110 on December 20 before recovering to 6,500. This development suggests that long-term demand has not disappeared, but short-term sentiment is easily influenced by derivatives volatility and liquidity.
During the same period, the market capitalization of NIGHT at one point increased by 430 million USD. However, the fact that the market capitalization still saw a sharp decrease during the day (from 1.94 billion USD to 1.52 billion USD) indicates that short-term selling pressure is prevailing at the time of data recording.
Derivatives are creating downward pressure in the short term.
Derivatives data leans towards the selling side as Open Interest decreased by 12% (equivalent to 12.7 million USD leaving the market) and the Funding Rate weighted by OI turned negative.
Open Interest (OI) decreased to about 106 million USD after 12.7 million USD withdrew, indicating that leverage participation is narrowing. The individual decrease in OI is not sufficient to conclude a downward trend, as it may also reflect traders closing positions when volatility increases.
However, when combined with the Open Interest–Weighted Funding Rate turning negative, the signal becomes 'more directional'. A negative Funding Rate often means that the number of short contracts is dominating long, or the short side is willing to pay fees to maintain positions. This aligns with the picture: the downward pressure mainly comes from the perpetual contract trading group.
Spot is still accumulating strongly and reinforcing long-term confidence.
In contrast to derivatives, the spot market continues to inject capital into NIGHT: at one point, investors spent 3.24 million USD to buy in, and total spot purchases over 5 days reached 301 million USD.
In the early morning of December 23, 3.24 million USD was recorded to be used to buy NIGHT on the spot. Over the past 5 days, total spot purchases reached 301 million USD, reflecting significant accumulation in a context where the general sentiment is still negatively affected.
This level of accumulation often implies long-term expectations and, in terms of supply-demand, could 'tighten' circulating supply if the amount of tokens withdrawn from the sell-ready region increases. This is a factor that could lay the foundation for upward movements when demand returns or when the short side needs to close positions.
Historical data in the 1-week frame shows that weekly buying activity has previously accompanied a price increase of 67%. Although it does not guarantee repetition, this correlation emphasizes the importance of spot capital flows for the price structure of NIGHT.
The Accumulation/Distribution (A/D) indicator also only adjusted slightly and still leans towards accumulation. At the time of recording, the total volume on A/D was at 357 million and remained positive, reinforcing the argument that spot buying power is still absorbing supply.
The liquidation heatmap supports the bullish scenario when liquidity concentrates above the price.
The liquidation heatmap shows thicker liquidity clusters located above the current price, while there are no significant clusters below, increasing the probability of prices being 'pulled' up.
On the liquidation heatmap, liquidity clusters above the price often act as 'price magnets' because when the price approaches these areas, stop-loss and liquidation orders may trigger additional volatility, pushing prices further in the direction of liquidity sweeps.
The lack of large liquidity clusters below the current price helps reduce the probability of a deep pull down to clear liquidations. If the liquidity structure remains unchanged and spot buying continues, NIGHT is more likely to move up to the liquidity zones above.
Combined with spot accumulation data, the recent correction can be viewed as a temporary technical rebound rather than a trend reversal. The bullish scenario will be clearer if the short pressure on derivatives weakens or is squeezed as prices advance to higher liquidity zones.
Conclusion
Current data shows a tug-of-war: derivatives create pressure as short positions increase and leveraged capital withdraws, while spot continues to buy heavily. If the liquidity cluster above remains thick and spot buying continues, the probability of NIGHT continuing to move up is still maintained, although short-term volatility may still be strong.
Frequently Asked Questions
Is the 24-hour volume drop of NIGHT an absolute bad signal?
Not necessarily. The volume decreased by 50% to 3.97 billion USD indicates short-term cooling, but may reflect capital rotation. Additional data on spot, derivatives, and accumulation indicators need to be compared to assess the overall trend.
What does a negative Funding Rate weighted by Open Interest indicate?
When this index turns negative, the market often leans towards the short side: the number of short positions may outnumber long or the short side is willing to pay fees to maintain positions. This is a signal creating downward pressure in the short term, especially when accompanied by declining OI.
Why is strong spot buying important for the price trend of NIGHT?
Spot buying reflects real demand not entirely based on leverage. Total spot purchases over 5 days reached 301 million USD and A/D remains positive (357 million) indicating that the absorption of supply is present, which can support prices and increase the risk of a short squeeze.
How does the liquidation heatmap support the bullish scenario?
When liquidity clusters concentrate above the price, prices tend to be pulled up to 'sweep' those areas. If there is a lack of large clusters below, the risk of a deep drop may be relatively lower, thus favoring a bullish scenario if other conditions do not worsen.
Source: https://tintucbitcoin.com/night-tam-nghi-hay-dao-xu-huong/
Thank you all for reading this article!
Please Like, Comment, and Follow TinTucBitcoin to stay updated with the latest news on the cryptocurrency market and not miss any important information!
$BTC $ETH $BNB $XRP $SOL
