Solana has hit a critical point in its trading journey, officially dropping below the psychological $100 mark and settling at $97. This decline is not merely a technical anomaly; it signals a significant liquidation event for overleveraged long positions that were unable to maintain the crucial triple-digit threshold. The document underscores a growing issue that traders need to be aware of in the current market climate.
Market Sentiment and Technical Indicators
The breakdown of this support level has raised alarms among traders, with technical indicators reflecting a bearish sentiment reminiscent of the post-FTX market conditions. The Relative Strength Index (RSI) on the weekly chart indicates that selling pressure may continue, suggesting that the market is not yet ready to stabilize. Should the $97 support fail, analysis of the volume profile reveals a potential liquidity vacuum that could drive prices down to the $78 range.
Impact of Institutional Flows
This situation is further complicated by a slowdown in institutional flows that had previously supported Solana's price throughout the first quarter. As these institutional investments wane, there is a growing concern that retail traders, fatigued by the ongoing market volatility, may capitulate. This could occur just as savvy investors begin to seek out higher-beta assets, potentially exacerbating the downward trend for Solana.
Solana's price has recently faced significant pressure, hovering just above a critical support level, which contrasts with its recent drop below $100. For more details, see the full report here.
