TLDR
- Solana (SOL) has dropped 15% over the past week, falling below $120 after breaking key support level
- SOL is currently trading near $118.49 with approximately $60.74 billion market cap
- Technical analysis shows a bearish triangle formation signaling continued downward trend
- Newly launched Solana ETFs (SOLZ, SOLT) have seen minimal volume compared to Bitcoin ETFs
- A new Solana Policy Institute has launched in DC to advocate for regulatory interests
Solana (SOL) has experienced a rough week, dropping 15% in value and testing a critical support level at $118. The sixth-largest cryptocurrency by market capitalization is showing signs of a continued bearish trend as technical indicators point to potential further decline if current support levels fail to hold.
SOL is currently trading near $118.49 with a total market valuation of approximately $60.74 billion. The price action briefly pushed Solana below Circle’s USDC stablecoin in the market cap rankings before it reclaimed the sixth position despite ongoing selling pressure.
The recent price movement follows several months of weakening support, with SOL repeatedly testing key price levels since May 2024 before finally breaking down.
Technical Patterns Suggest Continued Weakness
Chart analysis reveals a bearish triangle formation in Solana’s price action, which typically signals continuation of a downward trend. SOL attempted to break above the upper boundary of this triangle pattern but lacked the momentum to sustain the move.
The more times a trendline gets tested, the weaker it becomes. Eventually, it breaks. #Solana $SOL pic.twitter.com/sSCbU0AgUw
— Ali (@ali_charts) April 2, 2025
This failure pushed the asset back toward the lower boundary where the $118 support level now faces intense pressure.
The Bollinger Bands indicator shows increased volatility, with SOL trading near the lower Band support at $116. This suggests the downward momentum may continue without intervention from buyers.
Current resistance levels sit at the middle Bollinger Band ($129.73) and upper Band ($143.42), presenting hurdles for any potential recovery.
The Relative Strength Index (RSI) reading of 38.45 approaches oversold territory but doesn’t yet indicate an immediate reversal is likely.
If SOL fails to maintain the $118 support level, analysts project further declines toward $99. Should this secondary support fail, the price could slide toward $79, a psychological and technical support zone.
ETF Performance Underwhelms Expectations
Adding to Solana’s current challenges is the underwhelming performance of its recently launched exchange-traded funds. On March 20, Volatility Shares introduced two Solana ETF products: the Solana ETF (SOLZ) and the 2x Solana ETF (SOLT).
The new Solana futures ETF hasn't done much, a million in volume first few days is decent for normal ETF but nothing vs btc, about 80x less than $BITO's first few days or $IBIT's. Like we've said, the further you get away from btc the less asset there will be (which rhymes btw) pic.twitter.com/OqoIpzdeel
— Eric Balchunas (@EricBalchunas) March 31, 2025
However, these financial products have struggled to gain traction in the market. Bloomberg ETF analyst Eric Balchunas reported that the Solana futures ETFs saw minimal trading volume in their first days of trading.
The performance gap is striking when compared to Bitcoin’s ETF offerings. According to Balchunas, Solana’s ETFs have performed approximately 80 times worse than Bitcoin’s BITO ETF during their initial launch period.
This lackluster response suggests limited institutional interest in accessing SOL through these specific ETF vehicles, potentially reducing overall market demand and support for the asset during its current downtrend.
Regulatory Representation Expands
Despite market challenges, Solana’s ecosystem continues to develop its institutional framework. Miller Whitehouse-Levine, one of Washington’s top cryptocurrency lobbyists, has launched the Solana Policy Institute in DC.
This nonprofit organization aims to advocate for Solana’s interests in regulatory discussions as lawmakers increase their scrutiny of digital assets.
Whitehouse-Levine, who previously led the DeFi Education Fund, has emphasized the need for “smart regulation” in the cryptocurrency space.
The establishment of this policy group comes at a critical time for Solana as it navigates both market pressures and an evolving regulatory landscape.
Historically, the $118 level has served as a strong demand zone for SOL, where buyers have previously stepped in to absorb selling pressure and push prices higher.
Market participants are now watching closely to see if this support level can trigger a bullish turnaround or if the current bearish sentiment will push SOL to test lower support levels in the coming days and weeks.
The current market structure suggests traders should monitor the $118 zone closely for signs of either a recovery bounce or a breakdown that could accelerate losses.
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