TLDR
- Solana (SOL) is forming a cup and handle pattern that could lead to explosive breakout above $180 resistance
- Spot taker volume turned buyer dominant on May 25, similar to November when SOL climbed above $180
- SOL shows negative funding rate of -0.0002%, indicating short sellers are financing longs in derivatives markets
- Long-term active addresses continue growing, showing persistent network confidence despite short-term bearish signals
- Price has been consolidating around $175 supply zone for two weeks with bulls and bears waiting for clearer direction
Solana is showing technical patterns that could signal a major price breakout in the coming weeks. The cryptocurrency has formed a cup and handle pattern on its price chart, which typically indicates explosive upward movement when completed.
The altcoin faces immediate resistance at the $180 level. Over recent days, SOL has repeatedly tested this price point but failed to break through convincingly.
Despite these rejections, several indicators suggest bullish momentum remains intact. The Chaikin Money Flow indicator shows positive capital inflows into Solana. The On-Balance Volume metric indicates that selling pressure has not become overwhelming despite the resistance level rejections.
Moving averages continue to support bullish momentum. Technical analysis suggests buyers may soon have enough strength to push the price beyond the $180 barrier.
Whale Activity and Market Dynamics
Whale activity has remained relatively stable over the past two weeks. Large holders have not increased their selling despite bulls’ repeated attempts to breach $180. This behavior suggests whales may be anticipating further price gains rather than taking profits at current levels.
The spot average order size, calculated by dividing total trading volume by number of trades, has not shown the typical spikes associated with major whale movements. This stability near long-term demand zones could indicate accumulation behavior among large holders.
Spot taker volume data reveals important shifts in market sentiment. The spot taker Cumulative Volume Delta turned buyer dominant on May 25. This metric tracks whether aggressive buyers or sellers are driving price action.
The last time this indicator showed sustained buyer dominance was in mid-November. During that period, Solana successfully climbed above the $180 level after nine months of range-bound trading below this resistance.
Funding Rates Signal Market Positioning
Solana currently shows a negative funding rate of -0.0002% in derivatives markets. This makes SOL unique among top 10 cryptocurrencies, excluding stablecoins, as most assets show positive or neutral funding rates.
Negative funding rates mean short sellers are paying longs to maintain their positions. While the current rate appears small, it represents an early indication of pressure building on the short side of the market.
This funding rate pattern contrasts with the broader cryptocurrency market. Most major assets have maintained positive funding rates recently, making Solana’s negative rate stand out.
Long-term network metrics paint a different picture than short-term trading indicators. Active addresses on the Solana network continue growing, demonstrating persistent confidence from committed users and investors.
This growth in active addresses suggests a healthy underlying system that can support price increases over time. The expanding user base remains engaged despite some traders taking short positions.
Price action shows SOL consolidating around the $175 level for the past two weeks. This zone has served as a key supply area where bears have executed sell orders, accompanied by increased trading volume.
The consolidation period began on May 9 and continues today. Bulls and bears appear to be waiting for more decisive signals before committing to either direction.
Technical analysis on longer timeframes maintains a bullish outlook for Solana. The overall market structure suggests bulls remain in control despite short-term resistance levels and negative funding rates.
Recent spot taker volume turning buyer dominant on May 25 provides the most current bullish signal for SOL’s price trajectory.
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