Solana (SOL) is experiencing a prolonged period of intense bearish sentiment in its derivatives market, with funding rates remaining negative for 17 consecutive days. This marks the longest such streak in over 2.5 years, indicating a strong and sustained conviction among traders that the price will continue to fall.
The negative funding rate, which recently printed near -0.0042, signifies that short-sellers are dominant and are paying long-position holders to maintain their exposure. Market analyst Ted Pillows highlighted this development, noting that such extreme bearish positioning hasn't been seen since the selloffs of November 2022 and September 2023. This data suggests the current sentiment is driven by directional conviction rather than regular market noise.
Simultaneously, SOL's price action remains under significant pressure. After breaking down from a long-held trading range that supported it through much of 2024 and 2025, the altcoin is now clinging to the $80 support level. At the time of writing, SOL trades at approximately $88.01, reflecting a modest daily gain but remains about 70% below its all-time high after a 37.38% loss over the past 30 days.
Analysts point to two potential scenarios emerging from this crowded short positioning. The first is a continued downward trend, fueled by weak spot buying pressure and a decline in broader macro risk appetite. The second, more bullish scenario, is a potential short squeeze. If selling pressure exhausts and the market rebounds sharply, the overwhelming number of short positions could be forced to cover, amplifying a rapid upward price move.
Key price levels are also in focus. Analyst Ali Martinez pointed out that while $85.55 was previously a resistance zone, SOL's move toward $88 suggests this area may be flipping into a short-term support and demand zone. However, the broader structure remains weak, with SOL posting lower highs and lower lows. The former support range in the low $120s now acts as overhead resistance, and a failure to hold the $80 area could expose the next support band around the high $60s.
