Recent price movements of Solana (SOL) indicate resilience, even as the wider crypto market remains volatile.
While recovery attempts are underway, the token experiences selling pressure from mid-term holders, raising concerns about its immediate strength. Nevertheless, technical indicators suggest that Solana could initiate another rally if momentum is favorable.
Selling Among Solana Holders
On-chain data from HODL Waves highlights an intriguing trend among Solana investors. Mid-term holders—those who have maintained SOL for three to six months—are gradually selling off their assets. This group’s supply decreased by 1.7% in October alone, indicating that investors are liquidating their tokens due to uncertainty.
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Furthermore, the supply of six- to twelve-month holders hasn’t increased, reinforcing the idea that these coins are being sold rather than maturing. This trend points to increasing skepticism and could heighten selling pressure on SOL’s price.
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The HODL Cave metric provides insight into the motivations behind this selling behavior. Contrary to typical profit-taking actions, data indicate that these investors are more influenced by fear than greed. The median return for holders in the three- to six-month range varies between 1.14x and 1.4x, suggesting panic selling over strategic exits.
A significant number of investors seem eager to secure modest profits or limit potential losses, especially as prices fluctuate. This behavior is common during uncertain market conditions. If this cautious sentiment continues, it may restrict Solana’s upward potential in the near term.
Need for a SOL Price Bounce
As of this writing, Solana’s price is at $184, remaining above the vital $183 support level. The altcoin seems to be forming a flag pattern, a technical setup often linked to bullish breakouts. However, confirmation relies on volume strength and investor confidence.
After the recent downturn, SOL briefly exited this pattern but has since tested and reclaimed it. For a definitive breakout, Solana needs to bounce off the lower trendline or surpass $192. Failing to maintain buying pressure could push the token below $175, possibly dropping to $163, thus invalidating the bullish pattern.
On the other hand, if Solana crosses $192, it could exceed $200, a significant psychological level. Breaking out of the pattern could spark renewed momentum, paving the way for a potential surge toward $250. Still, investors and traders should be wary, given the current market instability.
