Solana Trading Volume Decline

Solana has seen a significant decline in trading volume, with the same falling to its lowest level of 2024

On the charts, SOL might be at risk of dropping lower, especially if total value locked (TVL) falls further.

Recent Price Performance

Over the past month, Solana’s price has exhibited sluggish market performance, dropping by 36%. Market sentiment hints at a further decline as more sellers step in.

An analysis of liquidity movement revealed a hike in SOL outflows over the past month. This trend appears to be continuing, particularly as it loses a key support level that typically provides a rebound.

Momentum Falls Massively as SOL Weakens

A major factor contributing to Solana’s decline is the sharp drop in momentum, with trading volume at a remarkable low of just $3 million—the lowest since September 2024.

When both trading volume and price fall simultaneously, market participants are likely selling their holdings, potentially leading to further drops in demand.

TVL, which tracks liquidity flow within Solana-based protocols, has dropped significantly from a peak of $12.19 billion in January to $6.69 billion at press time. These liquidity outflows signal that investors are selling their assets due to declining confidence, aiming to protect against further price drops.

Potential Drop to $100 or Below

AMBCrypto’s analysis of SOL’s price movement suggests that it could decline to $100 after losing the key support level at $128.01. Support levels typically cushion prices and facilitate rebounds. However, if breached, selling momentum may outweigh buying pressure.

If SOL fails to remain above the next support at $100.34, further declines to $85 could occur, taking the asset back into two-digit price territory, a level last seen in 2024. Liquidity clusters identified between $120 and $114 can attract prices downward.

Given the ongoing downtrend, SOL could set new lows on the charts.

Not All Traders Are Bearish

In the derivatives market, some traders are placing long bets in anticipation of a SOL rebound. Recently, buying volume in derivatives has increased alongside the OI-weighted funding rate.

Coinglass’s long-to-short ratio at press time is 1.004, indicating more buyers than sellers. This buying sentiment is supported by a positive OI-weighted funding rate, currently at 0.0086%, reflecting an uptrend since 13 March.

If the buying volume in the derivatives market remains strong and Solana reclaims the lost support at $128, a rebound could be imminent. Otherwise, further falls may occur.