Key takeaways
- Solana has fallen 10% over the past 24 hours and is now trading below $140.
- The coin could decline further as overall market sentiment weakens.
Market sentiment weakens as crypto suffers significant losses.
SOL, the sixth-largest cryptocurrency by market capitalization, has lost 13% of its value this week, marking a third consecutive week of losses. The bearish performance comes despite Solana spot Exchange Traded Funds (ETFs) in the U.S. being only two weeks old and recording historically low net inflows, a sign of weaker institutional demand. According to Sosovalue, U.S. spot Solana ETFs logged net inflows of $1.49 million on Thursday, primarily driven by the Bitwise Solana staking ETF. This was the lowest inflow since the ETFs launched, indicating reduced interest from institutional investors.
Additionally, CoinGlass data shows SOL futures open interest (OI) fell 3.34% in the last 24 hours to $7.35 billion, suggesting traders are closing long positions or reducing leverage.
Consistent with current market conditions, the OI-weighted funding rate shifted into negative territory at -0.0076% from an almost neutral level earlier in the day, showing that traders are carrying more short positions. If these conditions persist, any recovery will be a difficult battle for bulls.
Will Solana extend its slide to $120?
The daily SOL/USD chart remains firmly bearish, reflecting Solana’s weak performance over recent days. The coin is lower for the fourth consecutive day this week after slipping below the psychological $150 level a few hours ago.
At the time of writing, SOL was trading around $138 and eyeing the $126 low recorded on June 22. A break below that level could open the way to test the $100 psychological support in the coming days or weeks.
The Relative Strength Index (RSI) on the same chart has fallen to 36 and is moving toward the oversold zone, highlighting selling pressure. The Moving Average Convergence Divergence (MACD) has also failed to cross above its signal line, extending the downtrend.
However, if technical indicators improve and SOL holds above $126, a modest recovery toward the $155 demand-turned-supply zone could occur. The next resistance level near $175 may prove challenging in the near term.