Solana hovers within a narrow trading range: traders reassess risk exposure

Solana (SOL) current price is $128.96, with a 24-hour decline of -3.81%, and the market is in a critical consolidation phase. The token remains above important support levels, but the rebound momentum is limited, and market sentiment has shifted from panic to cautious observation. As leverage positions cool down and spot inflows slow, traders are reassessing the current risk-reward ratio.

Support Remains Stable, but Market Shows Weak Rebound

SOL entered a correction phase after breaking a local high $147 . The current price action indicates the formation of lower highs on the 4-hour chart, while breaking below the 20, 50, and 100 EMA(. This technical pattern signals short-term bearish pressure.

However, the broader technical framework remains above the key support at $121.70—a level that has previously supported rebounds multiple times. This suggests that the medium-term trend is still neutral and has not turned definitively bearish. Sellers are pushing the price down but have not gained control, and buyers are cautious and not actively stepping in.

The Chaikin Money Flow indicator shows a slight negative value, indicating mild capital outflows rather than panic selling. This reflects traders gradually reducing their positions rather than wholesale liquidation.

Key Resistance and Support Zones in Price Movement

Solana is currently trading within a defined range, with several price levels attracting market attention:

Resistance Levels:

• First Resistance: $133.80-$135.45 — coincides with key moving averages and previous supply zones
• Second Resistance: $142 — tested during the recent decline, serving as a stronger psychological barrier
• Psychological Level: $147 — regaining this level would immediately shift market sentiment and attract short covering

Support Levels:

• Recent Support: $131.40-$130.90 — a break below this could open the path toward $127.70
• Critical Support: $121.70 — losing this level would confirm a medium-term downtrend

Derivatives Market and Leverage Position Cooling Signals

Open interest data tell an interesting story. When prices rise, leverage positions increase; when prices fall, positions are reduced through liquidation. Recently, open interest has stabilized around approximately $7.3 billion, suggesting traders have reduced their risk exposure after volatility. Although leverage remains relatively high, its growth momentum has slowed.

Spot flow data also support this view. During sharp sell-offs, spot outflows were significant, but recent inflows have weakened, indicating selling pressure is easing. Overall, spot inflows reflect cautiousness rather than active buying.

What’s Next? Three Possible Scenarios for SOL

Bullish Scenario: If trading volume supports it, a break above $135.50 could serve as a short-term reversal point. Surpassing this level would push the price toward testing $142, then challenging the key resistance at $147. Reclaiming $147 would significantly change market sentiment and trigger short covering.

Bearish Scenario: If SOL cannot hold $130, downside risks increase. The price could head directly toward the key Fibonacci retracement level at $127.70, and in worse cases, drop to $121.70. Losing this support would initiate a broader downtrend.

Consolidation Scenario (most likely currently): Traders are waiting for confirmation signals. The price continues to oscillate between support and resistance until a clear breakout occurs. This pressure buildup will eventually lead to increased volatility.

Technical Summary and Trading Recommendations

Solana is at a critical technical juncture. The cooling of leverage positions and easing of spot inflows indicate market participants are repositioning. The $135.50 zone is a key short-term trigger—closing above this level suggests renewed upward momentum, while a breakdown increases downside risk.

Key indicators to monitor include the breakout of EMA clusters, volume behavior during breakouts, and subsequent changes in open interest. Currently, SOL is trading within a narrow but well-defined range, awaiting the next clear market signal.