Cardano's price has increased by 8.6% in the last 24 hours following increased excitement around Midnight, the new privacy-focused sidechain. In the lunar cycle, a midnight point usually marks a reset – a moment before a new beginning. But for ADA, this reset could mean the start of a new decline instead.
The price is still within a bearish pattern, momentum is weak, and several on-chain signals point towards a possible continuation of the same downward trend that has dominated for months. Could this be the start of a 39% drop in ADA's price?
Bear flag structure and hidden bearish divergence still support the downtrend
Cardano is still trading within a bear flag on the daily chart. A bear flag occurs when a sharp decline is followed by a smaller, upward channel. This channel often serves as a pause before the same downtrend continues.
Between November 10 and December 9, the ADA price formed a lower peak, while the RSI formed a higher peak. RSI, or Relative Strength Index, is a momentum indicator that shows whether buying or selling pressure is stronger. When RSI rises but the price does not follow, it often signals that the upward movement is weak and that sellers still have control over the trend.
Because ADA has already fallen about 54% in the last year, this hidden bearish divergence supports the view that the downtrend is not over.
Want more token insights like this? Sign up for editor Harsh Notariya's daily crypto newsletter here.
The flagpole of the bear flag gives a potential downside of 39% if the lower trendline is broken. This would place ADA near $0.25, a deeper bearish 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 rise as part of a larger downtrend.
Whales are leaving while used coins are increasing — are traders selling during the rise?
On-chain signals align with the bearish chart.
The largest Cardano whales, that is, wallets with over 1 billion ADA, have sharply reduced their exposure since December 8. Their total balance dropped from about 1.86 billion ADA to almost zero in just a few days. Whales do not empty positions in this way unless they expect better entry levels further down, or wish to leverage strength to sell out.
Another on-chain indicator confirms this behavior. Spent Coins Age Band tracks how many ADA tokens are moved each day, both from new and old wallets. On December 6, approximately 95.26 million ADA were moved on-chain. By December 10, the number had increased to 130.46 million ADA, a growth of about 37% over four days.
This increase shows that more owners, even among the oldest, are likely sending coins to the market. When whale wallets are emptied and the number of used coins skyrockets simultaneously, it usually means that traders are using the rise to sell, not to accumulate.
So the first part showed that the structure is bearish. This section shows that the behavior is also bearish. Now the price levels translate this overall pressure into concrete zones traders need to monitor.
Cardano price levels show a broader downward path
With both chart and on-chain signals pointing negatively, the next movements depend on some clear levels.
If the ADA price falls below $0.42, the lower trendline in the bear flag pattern is broken. From there, the price could slide towards $0.37. If $0.37 does not hold, a full flag projection towards $0.25 becomes more likely, thus a 39% downside as the pattern suggests.
For bulls, the path is narrower, but still possible. Cardano must first regain $0.55. A daily close above this level breaks the upper boundary of the bear flag and weakens the bearish setup. If ADA stays above $0.60, it will indicate that this Midnight phase is transitioning from a reset to a more constructive rise.
Right now, only a small drop of 7–8% is needed to trigger a bearish breakout, while an increase of nearly 20% is required to invalidate it. As whale wallets sell off and more coins are used, the evidence still points towards a decline.
