Solana’s Bearish Trend: Analyzing Market Movements and Onchain Data

The latest developments in the crypto market indicate a bearish outlook for Solana (SOL). Following the formation of a bearish engulfing pattern on the daily chart, traders are bracing for further downward movement. If this trend continues, predictions suggest that SOL’s price could fall to around $120.

Head-and-Shoulders Pattern Signaling Decline

The daily chart for Solana reveals a head-and-shoulders pattern, a classic bearish reversal signal. A breakdown below the key neckline level at $140, confirmed by a significant spike in trading volume, could trigger a further decline. Market analysts project that the downside target based on this pattern is approximately $126, supported by an immediate liquidity zone.

Moreover, there exists a demand zone outlined by an order block between $95 and $120, which may be tested in the coming weeks. While the potential for a bullish reversal exists if the price achieves a daily close above the resistance level of $157, current market trends suggest a more pressing need for caution.

Bitcoin Correlation and Investor Behavior

Solana’s price movements exhibit a strong correlation with Bitcoin, which could exacerbate the downturn if BTC retests support near the $100,000 mark. Increased sell-side pressure may drive SOL further down as market sentiment fluctuates along with Bitcoin’s dynamics.

Despite the bearish outlook, onchain data paints a more optimistic picture for Solana. According to Glassnode, the Network Value to Transactions Ratio (NVT) has dropped below 10, marking its lowest point since February 2025. This metric suggests a robust usage of the network in relation to its market value, highlighting Solana’s long-term potential even as its price struggles below $150.

In addition, data from the Exchange Net Position Change indicates an uptick in SOL withdrawals from exchanges. This trend indicates growing investor confidence, as the movement of SOL off exchanges typically signals accumulation for future gains. Recent net outflow peaks, such as the significant -4.6 million SOL on May 28, suggest a shift in investor sentiment despite the price’s recent dip.

While Solana’s price has experienced considerable volatility—dropping from a peak of $295 earlier this year—the onchain metrics suggest an underlying strength. The stable NVT ratio and increasing exchange outflows reflect robust network activity and investor willingness to hold, which could potentially outweigh short-term bearish trends.