Solana (SOL) is currently trading under significant pressure, hovering around the $85 mark after a sharp decline from its recent swing high of $148.88. The asset is now facing a crucial technical test at the $86.90 resistance level, which corresponds to the 0.236 Fibonacci retracement. A decisive break above this point is seen as a potential signal for a shift toward bullish momentum, while failure could lead to a revisit of lower support zones.
Price action on the 4-hour chart reflects a broader bearish trend, characterized by a sequence of lower highs and lower lows. Although a brief recovery was triggered from support near $67.78, buying pressure remains weak. The $84–$85 area is now acting as a key support level. The Average Directional Index (ADX) reading of around 25 indicates moderate trend strength, suggesting the prior selling momentum has cooled.
Derivatives data reveals a significant cooling in speculative activity, with open interest dropping from nearly $10 billion to $5.2 billion. This reduction in leveraged positions and long liquidations, coupled with compressed spot market flows, signals reduced market confidence and uncertainty among both bulls and bears, who are awaiting clearer directional signals.
Analysts note that Solana is trading within a well-defined range of $78 to $90, reflecting market indecision. A sustained breakout above $90 could target the $100 psychological level and beyond, while a breakdown below $78 would expose deeper demand zones, potentially down to $60–$65. From a higher-timeframe perspective, some see the $60–$80 region as a major accumulation zone, suggesting a potential long-term bottom formation.
Fundamentally, Solana's ecosystem shows strong growth. According to Messari's latest State of Solana report, the value of real-world assets (RWAs) on the network increased 58.7% quarter-over-quarter to $1.1 billion. The liquid staking ratio climbed to 17.6%, and stablecoin market capitalization grew 5.3% to $14.9 billion, indicating sustained liquidity and institutional adoption.
A separate macro narrative suggests Solana's long-term trajectory is closely linked to global M2 money supply. Analysts point out that while this correlation has recently broken, a realignment with expanding global liquidity could project a long-term price target as high as $2000.
