Solana (SOL) Loses Key Support As Crypto Weakness Deepens, New Downfall Coming?
Solana’s (SOL) recent price drop comes against a broader period of weakness across the digital asset market, with traders increasingly turning to risk-off.
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After several weeks of strong losses, SOL has fallen below key technical levels, raising questions about whether the current support can hold or if another lower leg is approaching. Market data shows declining merchant confidence, rising short-stopping, and weakening on-chain profitability.
According to data tracked on CoinMarketCap, Solana recently traded at a high of $70 after failing to sustain momentum above $95 at the beginning of the year. The move extends a six-week losing streak and puts the stock near key support areas that analysts say will likely determine the next move.
SOL's price trends to the downside on the daily chart. Source: SOLUSD on Tradingview
Derivatives Markets Signal Growing Under Risk
Open interest in Solana futures fell about 2% to about $5.09 billion, as trading volume rose sharply. This combination often indicates a closing of funds rather than new purchasing activity. Again, support rates turned negative, and the long-to-short ratio fell below 1, suggesting that many traders are placing additional dips.
A short bias also emerged among large accounts despite traders maintaining long exposure to exchanges such as Binance and OKX. Analysts warn that this imbalance could increase the risk of further volatility if support levels fail.
Technically, Solana remains below major moving averages, while momentum indicators continue to trend downward. RSI readings near the oversold zone indicate continued selling pressure rather than confirmed signs of a reversal.
On-Chain Data Shows Weakening Holder Confidence
On-chain metrics support a monitoring perspective. Statistics from Glassnode show that only about 20 percent of Solana addresses are currently profitable, the lowest level since late 2023. During previous market downturns, similar readings have been seen close to capitulation stages, suggesting that the downside risks may not last.
Long-term holders’ accumulation, which strengthened at the beginning of the year, has slowed significantly as the price has fallen below $100. Analysts interpreted this as a decrease in litigation among investors who had held the offer during the withdrawal.
Key Levels Traders Are Watching
The data on the chart shows the immediate support that is integrated between $75 and $67. A decisive break below this region could reveal a lower target near $62 or even $60 if selling is quick. On the upside, recovery efforts face resistance around $82–$83, where a bearish line has formed.
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Solana’s outlook hinges on whether buyers can defend against February’s decline. Despite the continued recovery of high resistance areas, the market structure suggests that the broader decline remains strong as uncertainty in the crypto market continues to dampen sentiment.
Cover image from ChatGPT, SOLUSD chart on Tradingview
