The cryptocurrency market has witnessed a bearish pullback this weekend, causing leading tokens to break below critical support levels. Solana ($SOL) is no exception, currently struggling to maintain its position within an ascending trend. A significant reason for this downturn is the ongoing controversy surrounding Solana-based memecoins like LIBRA, Pumpfun, and Meteora, leading to increased concerns within the community.
This negative sentiment has significantly impacted the Solana ecosystem, with its Total Value Locked (TVL) dropping from over $12 billion to $8.9 billion. Additionally, trading volume plummeted from $35 billion to as low as $2.5 billion, while transactions continued to rise, indicating a shift in trading behavior.
According to data from DeFiLlama, traders remain uncertain about SOL’s next move. The drop in trading volume suggests reduced demand while rising transaction numbers indicate increased individual trading activity.
Adding to the uncertainty, Open Interest (OI) has also decreased significantly, dropping from $6.5 billion to $4.1 billion after Solana faced rejection at its all-time high of $296. This decline in OI validates concerns about weakening bullish momentum.
At the time of writing, Solana has dropped 6.04% in the past 24 hours, with a trading volume of $2.95 billion (a 76.84% increase). The token has lost 11.11% over the past week and 22.88% in the last 30 days, bringing its market capitalization to $88.72 billion.
On the daily chart, SOL is currently breaking below a crucial support level, indicating a potential bearish continuation. If it fails to reclaim the $180 support, further downside movement could push the price toward lower Fibonacci retracement levels.
Source: TradingView
If Solana maintains its position above the crucial $180 support level, bullish momentum could drive the price toward its immediate resistance at $200. If buying pressure intensifies, the price could further surge to its upper resistance level of $210 in the near term.
Conversely, if bearish sentiment prevails, SOL may retest the $180 support. A breakdown below this level could see the token falling to the $170-$155 range in the coming days.
Crypto analyst Ali Martinez warns that SOL’s failure to hold support could trigger additional selling pressure. If the market remains uncertain, traders should prepare for increased volatility.
For long-term investors, this dip may present an opportunity to accumulate SOL at lower levels. However, short-term traders should remain cautious and monitor key support and resistance levels closely.
Solana’s price action remains at a critical juncture. While holding above $180 could lead to a recovery toward $200 and beyond, a breakdown could send prices lower. As the crypto market navigates this period of uncertainty, traders must stay informed and adapt their strategies accordingly
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