Solana (SOL) has gained over 19% in the last week, bringing its price to $230. This surge comes as the altcoin tries to rebound from recent declines.
Despite this substantial rise, holders seem skeptical about its longevity, with increased selling pressure as investors seek to lock in profits.
Solana Investors Are Bearish
According to data from the HODLer Net Position Change, long-term holders (LTHs) are actively selling their SOL. Their selling activity has reached a seven-month peak, highlighting a significant uptick in profit-taking. This trend suggests that many LTHs doubt the sustainability of the rally and are cashing out while they still can.
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The dip in mid-September appears to have unsettled investors, contributing to their lack of confidence. This aggressive selling undermines belief in Solana’s current upswing. If the trend of profit-taking persists, it may exert downward pressure on SOL’s price.
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Moreover, weakness in network growth is apparent. The number of new addresses on the Solana blockchain has decreased to a six-month low. This decline indicates fewer new participants are entering the market, suggesting limited incentives for investment in the asset.
The absence of new capital inflows raises concerns about Solana’s long-term growth. Without fresh buyers, sustaining upward trends becomes increasingly challenging. The drop in adoption metrics reflects diminishing market traction.
SOL Price Is Rallying
Currently, Solana is trading at $230, just below the crucial $232 resistance level. The 19% weekly increase has revived interest in the altcoin. However, overcoming this resistance is vital for the continuation of the rally.
If Solana can turn $232 into a support level, the token may rise further. Maintaining this level could pave the way to $242 in the upcoming days, reinforcing bullish momentum and indicating investor confidence in a stronger uptrend.
However, if bearish signals dominate, Solana risks dropping back to $221 or even $214. A decline to these levels would negate the bullish narrative and erase a significant portion of the recent gains.
