Critical Level is Key to the Bullish Scenario
Solana [SOL] recently experienced a significant drop after reaching a new all-time high in December. Over the past month, its value has declined by 18.18%. However, signs of recovery have emerged in recent days, with the price increasing by 7.09% over the past week and 5.42% in the last 24 hours.
Despite this growth, uncertainty remains. Although the overall market structure is bullish, recent selling pressure raises questions about the sustainability of this trend.
Network Activity Rises, but Selling Pressure Dominates
The Solana network has seen a surge in transactions, reaching 66.9 million over the past 24 hours. This increase may signal either buying or selling activity, depending on the behavior of market participants.
To better understand the situation, it’s important to analyze Solana's Exchange Netflow, which measures the difference between inflows and outflows on exchanges. Currently, this indicator is negative, suggesting that buying pressure dominates.
Over the last 24 hours, however, $6.15 million worth of SOL has been sold, and $75.18 million over the past week. Despite this buying pressure, the recent 5.42% price increase appears fragile, as trading volume has dropped by 25%. This decline in volume indicates that the current rally may lack sufficient market support.
If the price increase is not accompanied by higher trading volume, SOL could face a deeper correction.
Bullish Potential Remains, But Key Support is Crucial
SOL is currently trading within a critical support zone between $188.89 and $173.24. This area has historically attracted significant buying pressure, although such activity has yet to occur this time.
If SOL fails to hold this support zone, it risks returning to the consolidation phase it recently exited. On the other hand, if the support serves as a springboard, Solana could see significant growth. This movement could drive its price back to previous all-time highs or even higher.
The future of Solana will depend on how the market handles current pressures and whether it can capitalize on this support zone to sustain further growth.
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