Solana has recently experienced a price decline and made a brief attempt to recover its losses. However, the lack of investor patience is evident in their actions, which may lead to selling pressure that could negatively impact the altcoin's price.
As Solana struggles to find solid support, investor sentiment plays a crucial role in determining future price movements.
Solana Investors Skeptical
Solana's exchange balance shows an inflow of 2.7 million SOL, over $423 million, in the past 9 days. The price decline earlier this month prompted investors to sell and secure their positions before the situation worsened.
Interestingly, 2.71 million SOL was purchased over 5 days from May 23rd, suggesting accumulation due to FOMO (fear of missing out). This speculatively purchased supply has now mostly been sold, affecting Solana's price recovery.
The large inflow and subsequent outflow reflect the volatile sentiment in the Solana market. Investors who jumped in during price surges are now choosing to sell, creating a cycle of buying and selling that undermines price stability.
Solana's macro momentum is somewhat improving, but technical indicators like the Relative Strength Index (RSI) still suggest the market is in a bearish phase. The RSI shows the overall bearish momentum is slowly decreasing, but the indicator has not yet crossed over to support beyond the neutral mark.
This change is crucial in confirming a transition to the bullish area. Until this happens, Solana's price remains uncertain, and without strengthened investor sentiment, there is a possibility of further decline.
SOL Price Faces Resistance
Solana is currently trading at $158, rising 9.5% over the past few days. However, it remains just below a significant resistance level of $161.
For Solana to move to higher prices and target the next price point of $176, it must first break through this resistance. SOL needs to rise 11% to reach $176, and if this movement continues, it would indicate a robust recovery.
If selling pressure persists and Solana fails to break through $161, it could drop back to the $152 or $144 range. This would suggest a continuation of the downtrend, with investors continuing to sell their holdings. Such a decline would delay Solana's progress and postpone its recovery potential.
Meanwhile, if the overall market situation turns bullish, Solana could secure $161 as a new support level. Successfully breaking through this resistance could allow Solana to move to $168, which would invalidate the bearish logic and strengthen investor confidence.
