Key Takeaways
- A surge in outflows from Solana’s long-term holder wallets signals a loss of confidence, threatening price stability and increasing short-term bearish pressure.
- The ongoing Death Cross pattern and failure to break key resistance at $154 suggest SOL may face further declines unless broader market sentiment improves.
Solana (SOL) is struggling to reclaim recent losses as investor sentiment shifts and technical indicators continue flashing warning signs. Despite a short-lived price recovery, long-term holders are offloading assets, casting doubt on the altcoin’s near-term prospects.
Long-Term Solana Investors Begin Selling
Recent on-chain data reveals a concerning trend: Long-Term Holders (LTHs) of Solana have transitioned from accumulation to selling. Outflows from these wallets have reached a two-month high, marking a notable deviation from previous holding patterns.
This shift is significant because LTHs are typically regarded as stabilizing forces in the market. Their decision to sell suggests waning confidence, potentially increasing volatility for Solana’s price. If this trend continues, it could erode the support base that has historically cushioned SOL during downturns.
Technical Indicators Confirm Bearish Outlook
Solana’s macro technical picture further clouds its recovery chances. The asset remains trapped under a persistent “Death Cross” — a bearish pattern where the 50-day Exponential Moving Average (EMA) stays below the 200-day EMA.
In late May, the 50-day EMA came close to crossing above the 200-day line, hinting at a possible bullish reversal. However, it failed to break through, reinforcing the downward trend. As the EMAs continue to diverge negatively, traders are increasingly cautious, with further price declines still on the table unless this pattern is reversed.
Resistance at $154 Key for Bullish Breakout
SOL has seen an 18% drop over the past week, with a mild 5% rebound in the last 24 hours. It currently trades around $152 but faces stiff resistance at the $154 level — a critical threshold for any near-term rally.
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If Solana fails to breach this resistance, the price may retreat to $144 or even $136. Conversely, a breakout above $154 could drive SOL toward $161, potentially invalidating the Death Cross and restoring market confidence.
Until a decisive move occurs, Solana’s price action remains under pressure, weighed down by investor caution and a challenging technical landscape.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses
I’m a crypto enthusiast with a background in finance. I’m fascinated by the potential of crypto to disrupt traditional financial systems. I’m always on the lookout for new and innovative projects in the space. I believe that crypto has the potential to create a more equitable and inclusive financial system.
