Despite the successful launch of a key privacy-focused upgrade and a surge in on-chain activity, Cardano (ADA) continues to face significant selling pressure. The cryptocurrency’s price action remains firmly bearish, trading near annual lows even as network fundamentals show signs of improvement and founder Charles Hoskinson outlines an ambitious growth roadmap.
Market Sentiment Clashes with On-Chain Data
A clear divergence is emerging between different classes of investors. Data from derivatives markets reveals persistent pessimism, with negative funding rates indicating traders are paying a premium to maintain short positions. This suggests a risk-averse stance among speculative and institutional players.
Conversely, data from retail-focused platforms like Coinbase paints a different picture. The number of buyers recently exceeded sellers, and the count of unique traders increased. Market observers interpret this as retail investors accumulating ADA at depressed price levels, creating a tug-of-war between short-term derivatives speculation and longer-term retail accumulation.
Technical Picture Remains Precarious
From a chart perspective, Cardano’s situation is tense. The asset is currently trading around $0.38, close to its yearly low. It remains confined within a descending wedge pattern, and a gap of over 17% below its 50-day moving average underscores the technical weakness sustained over recent weeks.
Should investors sell immediately? Or is it worth buying Cardano?
While the Relative Strength Index (RSI) reading of 32.5 indicates an oversold condition, a definitive bullish reversal has yet to materialize. The technical pathway for the remainder of the year is clearly charted: a break above the $0.4350 resistance level is required to invalidate the current bearish structure. Failure to do so risks a test of the lower trend channel boundary at $0.3415, which would equate to a fresh 52-week low.
Hoskinson’s Vision and the Midnight Upgrade
Fundamentally, the launch of the “Midnight” sidechain, designed to enhance data protection capabilities, has provided a boost. Network activity and trading volume saw noticeable increases around the release date. Founder Charles Hoskinson has actively countered concerns that Midnight might draw users away from the main Cardano blockchain. Instead, he projects that its new privacy features could eventually multiply decentralized finance (DeFi) activity on Cardano by a factor of ten.
Such growth would necessitate a substantial rise in the network’s Total Value Locked (TVL), which currently lags behind competitors like Ethereum and Solana. To support this expansion, a development budget proposal for 2026 earmarks 70 million ADA to fund initiatives including stablecoin development and cross-chain bridge infrastructure.
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