The SOL price has dropped below $160 for the first time since November 2024 as it remains stuck within a steep bearish channel. Solana has been struggling lately due to increasing selling pressure and a drop in network activity. Several on-chain metrics have declined, along with DEX activity for the 5th consecutive week. This signals potential challenges ahead as SOL faces a key resistance level while there has been a substantial rise in investors’ confidence in other tokens like Ethereum.
The main reason for the SOL’s bearish action is speculated to be Binance, which has sold the token heavily. The token has been bearish for 5 consecutive weeks in times when $2 billion worth of SOL is about to get unlocked. On the other hand, the bearish flags over the token deepen as Wintermute, a leading liquidity provider, has withdrawn a huge amount of SOL from Binance in the last few hours.
As per some reports, they have withdrawn $38 million worth of SOL from Binance, which suggests a probability of selling the token at the highs, which could create strong selling pressure. This may further lead to a significant correction due to panic selling, paving the way for the platform to accumulate SOL at discounted prices. Currently, the SOL price has broken down the crucial support, which hints towards a drop below $150 that could be imminent.
The daily chart of Solana flashes massive bearish signals as the token has lost crucial support at $158 after a brief consolidation. The Gaussian channel has turned bearish while the price has dropped heavily below the channel. This suggests the token must undergo a huge recovery phase to turn the channel back bullish. On the other hand, the Chaikin money flow (CMF) has dropped below 0 after maintaining the average levels since December.
Currently, the bearish strength has been increasing compared to that of the bulls, which is expected to drag the price towards the local support zone below $140. If the Solana (SOL) price fails to hold $150, the bearish action is expected to drag the levels below the range, within the support zone between $138 and $139.
