- Bollinger Bands shows immense uncertainty, but red candles carry on to lead the trading activity, indicating a strong selling pressure.
- If Solana is not able to get back to $130, the downtrend may further boost, making the $100 level in focus.
- The relative strength index is hovering at 23.92, signaling extreme oversold conditions, this does not always indicate a quick bounce.
The price of Solana has gone down to $126 and has hit its lowest since mid-October, as investors get ready for a forthcoming 11.2 million SOL token unlock.
As per CoinMarketCap, Solana has dipped around 9% in the past 24 hours and about 27% over the last week, causing concerns boosting over extra selling pressure. A prime holder of Solana, FTX has been selling off assets in order to repay creditors in the bankruptcy process.
Around 41 million SOL tokens have already been sold to companies such as Galaxy Digital, Panthera Capital as well as Figure. The upcoming scheduled unlock on March 1, is estimated around $11.2 million SOL or about $1.3 billion at recent prices and has increased fears of a probable sell-off.
The slump of TVL
This has created downward pressure on Solana in a so-far weak market. Adding more to this, activity on the decentralized finance landscape of Solana has gone down. The total value locked of the network slumped from $12 billion in the middle of the last month to $6.8 billion on February 28, as per DeFiLlama report.
The demand for Solana has also gone down because of the latest downturn in memecoin trading, which once ignited enormous trading volumes. The technical indicators mention one more downside risk.
Solana has gone down the critical back level of $127, with the upcoming important marks at $110 and $100. However, the relative strength index is hovering at 23.92, signaling extreme oversold conditions, this does not always indicate a quick bounce.
Red candles lead the trading activity
Bollinger Bands shows immense uncertainty, but red candles carry on to lead the trading activity, indicating a strong selling pressure. Solana might shift towards the $110-$100 range if it breaks below $127, but if momentum varies, it might recover to around the $150-$166 range.
Traders are looking for a determining step as Solana tests major levels. CoinGlass, data shows that open interest in Solana futures has exceptionally slumped, starting from $7.4 billion in mid-January to $3.7 billion on February 28.
This shows that leveraged positions have notably gone down. However, institutional companies like VanEck and Franklin Templeton have filed for Solana ETFs, there are still no quick catalysts as ETF approvals might not be so quick.
If Solana is not able to get back to $130, the downtrend may further boost, making the $100 level in focus.
