SOL's 5% surge to $160 driven by ETF news completely reversed within 24 hours, exposing ongoing technical weakness on both low and high time frames.
SOL is trading near the key supply cluster of $144.5 to $147.7. A drop below $144 could trigger a decline to $124 or even $95 to $100, where support is thinner.
SOL rose 5% to $160 on Monday following news that its first exchange-traded fund (ETF) would begin trading on Wednesday. However, this momentum was short-lived, and the altcoin erased all gains within 24 hours, showing price weakness across multiple time frames.
On the low time frame, SOL has failed to maintain above the 50-day and 200-day exponential moving averages (EMA) for over a month. Despite several bullish structural breakout patterns, including a breakout above $148 last week, the altcoin has not managed to convert these into a sustainable upward trend.
The $148 level is currently under pressure, and a drop below $137 would confirm a lower low, negating the chances of a recent bullish continuation. For SOL to regain upward momentum, it is crucial to successfully retest the demand area between $145 and $137, followed by reclaiming above $160.
On the high time frame (HTF), the broader trend remains bearish. In May, SOL failed to break through the key resistance level of $180 and has since been trending downward within a descending channel.
While this pattern could lead to a bullish breakout, SOL has been highly sensitive to Bitcoin's weakness over the past month. Although Bitcoin (BTC) hovers near historical highs, this crypto asset has dropped nearly 50% since January 19, reflecting relatively poor performance.
If the bearish trend continues, a retest of the daily order block between $120 and $95 remains realistic, providing a more attractive long-term entry point. However, a strong daily close above $160 in the coming weeks could reverse sentiment and accelerate a bullish turnaround, bringing short-term momentum into higher time frames.
SOL is trading around $148 on Tuesday, with its UTXO Realized Price Distribution (URPD)—an indicator tracking the price levels at which tokens were acquired—providing key insights into support and resistance areas. The current price is within a 14.3% supply cluster between $144.5 and $147.7, indicating a high concentration of holders. This level is critical; if buying pressure persists, this range may maintain the current price.
Data from Glassnode indicates that staying above $144 is crucial. A drop below this threshold signals potential weakness, increasing the likelihood of retesting lower support areas.
The $100 to $97 range holds 3% of the supply, while $124 supports 1.58%, providing limited buffer. If the price fails to hold above $144, the market faces the risk of a deeper drop to these levels, where thinner supply could amplify volatility.
Resistance appears at $157, where 5.55% of the supply is concentrated, posing a challenge to upward momentum. Currently, the dense cluster between $144.5 and $147.7 emphasizes a solid foundation, and investors should guard SOL's price at this level.
Related: Analysts raise the probability of approval for Solana (SOL), Ripple (XRP), and Litecoin (LTC) ETFs to 95%
This article does not contain investment advice or recommendations. Every investment and trading action involves risk, and readers should conduct their own research when making decisions.
Original article: “Solana (SOL) ETF news gains evaporate, chart warns of another 20% drop”
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