Main Takeaways:
Solana (SOL) faced a challenging week in 2025, experiencing an 18% decline over the past week, second only to Hyperliquid among the top 20 cryptocurrencies in terms of losses.
This decrease sets SOL/USD up for its lowest weekly close since late August, stirring speculation about a potential drop toward the $120 mark.
According to CoinGlass, Solana’s futures open interest (OI) reached an all-time high of 71.8 million SOL, amounting to $14.5 billion at the time of writing on Thursday. In addition, perpetual funding rates flipped to 0.0043% from -0.0065% with the rise in OI.
Related: Australian fitness company plunges 21% on Solana treasury gamble
Increased open interest and rising funding rates during a price decline may result in an overleveraged market where long positions are caught off guard.
The prevailing market structure also favors bearish sentiment according to other indicators. Net taker volume is skewed towards selling, indicating that aggressive sellers are increasing their presence.
Simultaneously, spot CVD has declined, suggesting that the sell-off is largely driven by spot trading, which could further benefit the bears.
Moreover, data from DefiLlama indicates deteriorating network metrics, including a 16% drop in total value locked in Solana DeFi protocols and an 11% decrease in daily transactions over the past week.
As reported by Cointelegraph, Solana’s dwindling network activity alongside competition from other layer-1 blockchains pose substantial challenges for any near-term price recovery.
SOL Price Technical Analysis: Is Solana Heading Back to $120?
The price movement of SOL between Aug. 2 and Thursday has created a developing inverted V-shaped pattern on the daily chart.
Bears capitalized on this upward movement, leading to a significant correction towards current levels, nearing the bottom of the pattern.
The relative strength index (RSI) is trending downwards, falling from 69 to 37 since Sept. 18, indicating stronger bearish momentum and not yet being in an “oversold” condition.
As the price attempts to finalize the inverted V-shaped pattern, it may decline further towards the pattern’s neckline around the $155 demand area, suggesting a 22% drop from current prices.
When viewing the bigger picture, a double-top formation on the weekly chart signals a potential revisit to the pattern’s neckline at $120, illustrated below. This would translate to an overall 40% drop from current levels.
However, bulls may find opportunities for short-term recovery as the RSI is now greatly “oversold” across shorter time frames.
According to Cointelegraph, SOL price may continue its downward trend toward the $150-$110 range if support at $200 is breached.
This article does not provide investment advice or recommendations. All investments and trading actions carry risks, and readers should do their own research before making any decisions.
