Cardano's price has risen by 8.6% in the last 24 hours as excitement builds around Midnight, its new privacy-focused sidechain. In the lunar cycle, a midnight phase usually marks a restoration — a moment before a new beginning. But for ADA, this restoration could signal the start of a new decline instead.
The price is still within a downward pattern, momentum is weak, and several on-chain signals point to a possible continuation of the same downward trend that has dominated for months. Could this be the start of a 39% price drop for ADA?
Bear flag structure and hidden bearish divergence still favor a downward trend
Cardano is still trading within a bearish flag on the daily chart. A bear flag forms when a steep decline is followed by a smaller, upward-sloping channel. That channel often acts as a pause before the same downward trend continues.
Between November 10 and December 9, ADA’s price reached a lower high while the RSI reached a higher high. The RSI, or Relative Strength Index, is a momentum indicator that shows whether buying or selling pressure is stronger. When the RSI rises but the price does not follow, it often signals that the bounce is weak and sellers are still in control of the trend.
Since ADA has already fallen by approximately 54% over the past year, this hidden bearish divergence supports the idea that the downtrend is not over.
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The bear flag's pole projects a potential decline of 39% if the lower trendline is broken. That movement would place ADA near $0.25, a deeper negative target.
This lays the groundwork for the rest of the story: Midnight may mark a new phase for the network, but the chart still treats this bounce as part of a larger downward trend.
Whales leave as spent coins bounce – are traders selling into the bounce?
The on-chain signals align with the bearish chart.
The largest Cardano whales, wallets holding more than 1 billion ADA, have significantly reduced their exposure since December 8. Their total balance fell from around 1.86 billion ADA to nearly zero in just a few days. Whales do not empty positions in this way unless they expect better entry points lower or want to use strength to exit.
A second on-chain metric confirms this behavior. Spent Coins Age Band tracks how many ADA tokens are moving each day, across both young and old wallets. On December 6, around 95.26 million ADA was moved on-chain. By December 10, that number had risen to 130.46 million ADA, an increase of about 37% in four days.
This jump shows that more holders, including older ones, may be sending coins to the market. When whale balances collapse and spent coins shoot up simultaneously, it usually means that traders are using the bounce to sell, not to accumulate.
So the first section showed that the structure is bearish. This section shows that the behavior is also bearish. Now, the price levels simply translate this collective pressure into specific zones that traders need to keep an eye on.
Cardano's price levels show a broader downward path
With both the chart and on-chain signals leaning negatively, the next movements depend on some clear levels.
If the ADA price falls below $0.42, the lower trendline of the bear flag is broken. From there, the price could drop toward $0.37. If $0.37 does not hold, the entire flag forecast toward $0.25 becomes more likely, which is the 39% drop that the pattern suggests.
For bulls, the path is narrower but still possible. Cardano must first reclaim $0.55. A daily close above this level would break the upper boundary of the bear flag and weaken the bearish sentiment. Staying above $0.60 would then show that this midnight phase shifts from a restoration to a more constructive recovery.
Right now, only a small decline of 7–8% is required to trigger the bearish drop, while almost a 20% increase is needed to invalidate it. With whales leaving and spent coins rising, the weight of the evidence still leans toward the downside.
