- Solana (SOL) has pulled back 14.5% from its all-time high, despite record whale activity signaling strong institutional confidence.
- Technical indicators suggest weakening momentum, with key support levels at $223, $211, and $191.85 potentially shaping its next move.
Solana (SOL) has recently faced a turbulent market phase, pulling back 14.5% from its all-time high (ATH) recorded on January 19. Despite this dip, SOL has retained an impressive 16.7% weekly gain, highlighting the token’s robust performance. However, weakening technical indicators and critical support levels loom large, raising questions about its next move.
Record-High Whale Activity Reflects Institutional Confidence
One notable highlight amidst Solana’s volatility is the surge in whale activity. Addresses holding 10,000+ SOL reached a record 5,137, reflecting heightened institutional interest. This figure, slightly tapering to 5,128 in recent days, underscores whales’ pivotal role in the market.
Institutional players often influence major price trends, and their continued accumulation signals confidence in Solana’s potential. The sharp jump in whale addresses from 5,054 on January 17 to 5,128 over just six days further emphasizes this bullish sentiment. While this trend could indicate upward momentum, it also brings a caveat—heightened volatility due to potential coordinated movements by these large holders.
Technical Indicators Reveal Momentum Weakening
From a technical standpoint, Solana’s trend strength appears to be waning. The Average Directional Index (ADX) has plummeted from an exceptionally strong 66.2 to 27.2 within four days. While a reading above 25 still denotes a strong trend, the sharp decline highlights a significant loss in upward momentum.
The Directional Movement Index (DMI) adds further context, with the Positive Directional Indicator (+DI) slipping from 26.2 to 22.2 and the Negative Directional Indicator (-DI) rising from 12.5 to 17.4. This shift indicates growing selling pressure, potentially signaling a trend reversal or consolidation phase.
Critical Support Levels and Price Outlook
The narrowing gap between Solana’s exponential moving averages (EMAs) suggests decreasing bullish momentum, even as the short-term EMA remains above the long-term EMA.
Key support levels at $223, $211, and $191.85 are pivotal in determining SOL’s next major move. A breach below $223 could accelerate bearish sentiment, while further declines may push the price to $191.85. Conversely, a renewed bullish push could propel SOL toward the $295 mark, with a breakthrough above $300 solidifying a historic milestone.
Solana’s current pullback, combined with record whale activity, paints a mixed picture. While institutional confidence underscores long-term potential, weakening technical indicators and critical support levels demand cautious optimism. As the market eyes whether SOL can regain momentum or face a deeper correction, traders should closely monitor these key levels to navigate Solana’s dynamic price action effectively.
