Cardano Downtrend Persists After Midnight NIGHT Launch and Stalled Rally

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Cardano Downtrend Persists After Midnight NIGHT Launch and Stalled Rally

Cardano‘s price has entered a strong downtrend following the Midnight sidechain’s NIGHT token launch on December 8, 2025, with ADA dropping from $0.484 amid rising selling pressure and failure to hold key supports like $0.405, signaling potential further declines unless Bitcoin stabilizes.

• Cardano experienced a 30.6% rally to $0.484 before stalling, but indicators like CMF show increasing capital outflows below -0.05.
• The swing low at $0.405 is under threat, with a break below risking a bearish shift toward $0.37 support.
• Liquidation heatmap reveals short liquidations above $0.48, yet sparsity between $0.40-$0.50 could hinder quick recoveries, per data from CoinGlass.

What is causing Cardanos downtrend after the Midnight sidechain launch？

Cardano‘s downtrend stems from the Midnight sidechain’s NIGHT token launch on December 8, 2025, which coincided with heavy losses for ADA holders, turning a potential rally catalyst into a selling trigger. Despite an initial 30.6% surge from $0.37 to $0.484 in the week prior, bulls failed to sustain momentum and reclaim the $0.52 resistance, leading to renewed bearish pressure as Bitcoins volatility exacerbated outflows. Technical indicators confirm the bearish structure remains intact, with daily closes threatening key supports.

How do Cardanos technical indicators signal a continuing downtrend？

Cardanos 1-day chart reveals a bearish structure where the swing low at $0.405 faces direct seller threats, potentially shifting the overall trend if breached on a daily close. Further downside targets the $0.37 support, as confirmed by data from TradingView, where a breakdown could accelerate the downtrends progression. The Chaikin Money Flow (CMF) indicator has dipped below -0.05, highlighting rising selling pressure and significant capital outflows since the October 10 crash, while the Directional Movement Index (DMI) underscores persistent bearish dominance. Experts from financial analysis platforms note that such confluence in indicators often precedes prolonged corrections in volatile markets like cryptocurrencies, with short sentences emphasizing the urgency for traders to monitor these levels closely for confirmation of further weakness.

Source: ADA/USDT on TradingView

The launch of Midnight‘s NIGHT token arrived during a period of substantial losses for Cardano holders, creating what analysts described as an “extreme buy” opportunity that ultimately failed to materialize into sustained gains. A week before the December 8 event, ADA prices initiated a rally from $0.37, peaking at $0.484 by December 9—a 30.6% increase driven by anticipation around the sidechain. However, the inability to push beyond this level and challenge the longstanding $0.52 resistance exposed the rally’s fragility, as bearish forces regained control.

Market observers from platforms like TradingView have highlighted how such failed breakouts often indicate underlying weakness, especially in a broader cryptocurrency ecosystem influenced by Bitcoin‘s erratic movements. The downtrend’s momentum is further evidenced by declining trading volumes during the attempted recovery, suggesting limited conviction among buyers. As Cardano navigates this phase, the interplay between its ecosystem developments and macroeconomic factors continues to shape investor sentiment, with data pointing to a cautious outlook in the near term.