Solana Faces Bearish Pressure as Whales Sell and Retail Buyers Accumulate, $154 Support Possible

Solana (SOL) has fallen 12.38% in one week due to whale sell-offs and rising short positions, despite retail investors buying the dip. The $154 support level is now critical for price stability.

Whales have exited the spot market but increased activity in futures indicates a shift toward shorting.

Retail investors continue accumulating, creating a potential floor amid volatile market conditions.

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Solana price drops 12% amid whale sell-offs and rising shorts; retail buyers step in. Stay updated on SOL’s critical $154 support level and market trends.

Solana’s Sharp Price Decline Highlights Bearish Market Sentiment

Solana (SOL) experienced a significant 12.38% price decline over the past week, falling from $206 to a local low near $159. At press time, SOL traded around $162, reflecting continued downward pressure. This drop pushed SOL into a descending channel, with key momentum indicators flashing bearish signals, underscoring the prevailing negative sentiment in the market.

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Whale Activity Signals Increased Selling Pressure in Spot Market

After a period of inactivity, Solana whales have returned to the spot market, but their actions suggest a bearish outlook. CryptoQuant’s Spot Average Order Size data shows whales ceased accumulation during the recent rebound and are now closing positions. Notably, a whale deposited 108,016 SOL, valued at $17.74 million, into centralized exchanges OKX and Binance, indicating preparation for selling. Historically, such moves by whales precede further price declines.

Source: CryptoQuant

Futures Market Activity Reveals Growing Bearish Bets

While whale activity slowed in the spot market, CryptoQuant’s Futures Average Order Size data reveals a surge in large whale positions in the derivatives market. This shift coincides with Solana’s Open Interest dropping 7.28% to $9.30 billion, while derivatives volume increased by 4.62% to $26.72 billion. These trends suggest traders are favoring short positions amid bearish market conditions.

Source: CryptoQuant

The Long/Short Ratio currently stands at 0.9231, indicating a predominance of short positions. Binance’s top trader data further confirms this bearish sentiment, showing a short position ratio of 2.57.

Retail Investors Continue Accumulating Despite Whale Sell-Offs

Contrary to whale behavior, retail investors appear to be buying the dip. CoinGlass data shows Solana has experienced negative Spot Netflow for seven consecutive days, signaling sustained retail accumulation. At press time, the netflow was -$1.86 million, a marked decrease from -$95.49 million earlier in August.

Source: CoinGlass

What Is the Outlook for Solana’s Price Movement?

Solana’s price momentum is currently bearish, with the Relative Strength Index (RSI) dropping to 41 and the Stochastic RSI reaching a low of 0.07, both indicating oversold conditions. These technical indicators suggest sellers dominate the market. If this trend continues, SOL could test the $154 support level. However, sustained retail buying might stabilize the price and enable a rebound toward $183.

Source: TradingView

Key Takeaways

• Solana’s price dropped 12.38% in one week, falling from $206 to $159 amid bearish momentum.
• Whales exited the spot market and increased short positions in futures, signaling bearish sentiment.
• Retail investors continue buying the dip, potentially supporting a price rebound if sustained.

Conclusion

Solana’s recent price decline is driven by whale sell-offs and rising short positions, while retail investors accumulate amid volatility. The $154 support level is crucial; if breached, further losses may occur. However, sustained buying pressure from smaller investors could stabilize SOL and pave the way for recovery. Market participants should monitor momentum indicators and whale activity closely for future trends.

Frequently Asked Questions

Why did Solana experience a sharp price decline recently?

Solana’s price fell sharply due to large whale sell-offs and increased short positions in the futures market, reflecting strong bearish momentum despite retail investors buying the dip.

How does whale activity impact Solana’s market trends?

Whale activity often signals market direction; recent whale sell-offs and deposits to exchanges indicate preparation to sell, which typically precedes price drops and increased volatility.