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Solana (SOL) continues to face significant downward pressure, with both the Balance of Power and Chaikin Money Flow indicators signaling a bearish sentiment in the market.
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This persistent selling pressure has caused SOL to drop below key support levels, raising concerns about potential further declines.
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According to recent analysis, “the dominance of Solana sellers has become pronounced, highlighting the challenges the altcoin faces.”
Solana struggles under bearish pressure, with key indicators suggesting a possible decline below critical support levels while buyers fight to regain control.
Solana’s Technical Indicators Signal Bearish Conditions
Recent analyses of the SOL/USD chart reveal a troubling trend for Solana as it attempts to regain its footing in a challenging market. The Balance of Power (BoP) indicator has prominently fallen into negative territory, reflecting the ongoing struggle for dominance between buyers and sellers. When the BoP dips below zero, it reinforces the narrative of a market led by sellers, increasing the likelihood of further price declines.
As of the latest data, the BoP stands at -0.54, which reiterates the strong influence of sellers and highlights the risks associated with holding SOL in the current climate. Historical data correlates such negative readings with a marked decrease in price, suggesting caution for potential investors.
Solana Balance of Power. Source: TradingView
Liquidity Trends Highlight Ongoing Selling Pressure
In addition to the BoP, the Chaikin Money Flow (CMF) indicator also presents alarming figures for SOL’s liquidity. The CMF, which gauges the flow of capital into and out of a cryptocurrency, has recently shown a negative rating of -0.05, confirming the strong position of sellers in the market. This liquidity struggle indicates that selling pressure continues to overwhelm potential buying interest.
The CMF’s negative value underscores the ongoing distribution phase, suggesting that traders should remain vigilant as these trends can often herald further price declines. Should the negative sentiment persist, traders may want to prepare for a potential drop in price as well.
Solana Chaikin Money Flow. Source: TradingView
Current Support Levels and Future Outlook for Solana
As per the current analysis, Solana’s price action has displayed a concerning trend within a descending channel, with critical support now breached at $225.74. This break could indicate that SOL may experience a more drastic decline towards $203.63, a level that many analysts consider pivotal in the upcoming sessions.
Should SOL successfully rebound from this support level, however, there’s a potential recovery towards $264.66, which could be seen as a strong bullish comeback. In the most optimistic scenario, should bullish momentum accelerate, Solana might even aim for the elusive $300 mark, but the current market sentiment casts doubt on such prospects.
Solana Daily Analysis. Source: TradingView
Conclusion
Solana’s current metrics reveal a market dominated by sellers, indicating a potential for further price declines should these trends continue. The bearish readings from both the Balance of Power and Chaikin Money Flow showcase the challenges facing investors looking to capitalize on any bullish reversals. By monitoring critical support levels and market sentiment, traders can navigate the highs and lows of the Solana market with greater awareness.
