The price of Solana token has increased by nearly 30% this month, however, analysts warn of potential weakening of this momentum and risks of a downturn.
Investors Cashing Out
Despite the price surge, long-term holders of Solana tokens are reducing their positions. Glassnode data indicates a sharp decline in net position change, with over 1.5 million SOL leaving long-term wallets. This shift typically signals distribution rather than accumulation, casting doubt on the sustainability of the current rally.
Technical Barriers Ahead
Solana's chart reflects indecision as the $215–$220 zone acts as a stubborn barrier, capping every breakout attempt. Without a decisive close above this zone, the token risks slipping back into lower ranges. The Money Flow Index shows limited new inflows, indicating a lack of fresh capital to support the rally.
What to Watch Next?
Unless buyers return strongly, Solana's current structure appears fragile. A convincing move above $220 could flip sentiment and extend the uptrend, but if selling intensifies, a revisit of $200 or lower is possible. Currently, the balance between short-term traders taking profits and long-term holders reducing exposure leaves Solana at a crossroads.
The current market situation for Solana requires careful analysis. Investors should be prepared for shifting sentiments, as the rally may be threatened by declining interest from long-term holders.
