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Solana (SOL) is undergoing a period of consolidation, with its price fluctuating between $87 and $77 in recent weeks. However, recent market developments suggest that the cryptocurrency may be at risk of a significant decline.
A bearish pattern has emerged, and the change in investor behavior could lead to a price collapse, with potential losses of up to 38% if SOL breaks below key support levels.
Growing concern: STH Earnings in Solana
A key indicator of concern for Solana is the long-term holder’s net unrealized gain/loss versus STH NUPL). Since February, the unrealized earnings of short-term rights holders (STHs) have increased continuously.
STH companies are usually quick to sell when they make a profit, and this can add up Significant pressure on the price of Solana. The absence of similar growth in earnings among LTH companies means there is less stability for long-term dividend holders.
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In fact, if LTH companies also do panic selling, it could add more downward pressure on the price. The lack of support from these long-term holders increases the risk of overselling in the market.
Solana is under increasing pressure to sell
Solana’s overall momentum is showing signs of weakening. The Index of Change in Net Exchange Position highlighted the increasing trend of exchange flows, indicating an increase in sales activity.
Over the past four weeks, this indicator has consistently indicated that… Solana faces Selling pressure from investors led to increased negative sentiment surrounding the asset.
As more Solana holders sell their holdings, It can grow Descending pressure on Solana. This increase in sales can also complicate the bearish pattern that forms on the charts, increasing the possibility that the price will fall below critical support levels.
The SOL price may drop from the flag
At the time of writing, Solana is trading at $83, staying in the range $77-$87. The formation of a bear flag pattern indicates that the price could see a significant decrease if it falls below the support level of $77. A collapse may result below this level At the collapse of Solana From 38%, with the price potentially falling to a minimum of $51.
To make this farm, the selling pressure would need to continue to grow, and Solana would need to break the support level of $ 64. If this happens, the price can fall to $ 57, $ 51, and finally $ 45, confirming the bearish pattern.
However, if investor sentiment changes and the focus shifts towards supporting the recovery, The price of Solana may go up of the installation process. If SOL can break through the resistance levels at $88 and $96, it will invalidate the negative outlook, which could push the price higher towards $100, marking a monthly high.
