Solana’s Significant Price Drop

Over the past six weeks, Solana has registered a massive fall from the all-time high of $295, plunging to $139, marking a significant drop of over 50%.

With a low price rejection from a 24-hour low at $131, Solana struggles to maintain dominance above its 100-week EMA. Will increased selling pressure and the broader market crash drive Solana down to $85?

Solana’s Weekly Price Action: More Downside Ahead?

In the weekly price chart, Solana has formed six consecutive bearish candles. Currently, it trades at a market value of $139.5.

The MACD and signal lines show a negative crossover with a surge in bearish histograms. However, the 20, 50, and 100 EMA lines maintain a positive alignment.

The 100-week EMA line currently supports the ongoing decline and projects potential turnaround signals with lower price rejections. Nonetheless, increased selling pressure warns of a breakdown rally.

From price action analysis, Solana is likely to test immediate support near $128. If it closes under this level, a further decline to $85 is probable.

On a bullish note, sustaining above the 100-week EMA could see it test the 50-week EMA at $167.

FTX Token Unlock: Will SOL Hit $100?

Despite minor lower price rejection, an impending token unlock in the Solana network might spike market price volatility. According to the Solana portal, the network is set to unlock 11.16 million SOL tokens, valued at $1.56 billion, from the FTX exchange after its bankruptcy in 2022.

This unlock could significantly increase supply pressure, possibly causing a quick price drop.

Solana Derivatives Data Signals Increased Volatility

Amid the market crash, Solana’s derivatives data shows heightened volatility. Open interest has decreased by 13% to $4.54 billion, while the funding rate surge stands at 0.0041%.

Long liquidations have reached $100 million, with short liquidations at $11.5 million, indicating minor bearish dominance in market positions reflected by a long-to-short ratio of 0.9399. However, top exchanges like Binance and OKX show a bullish ratio, with 3 to 4 times more bullish positions in play.