Will Solana drop under $80 as downward stress builds? | UNW

Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) are all trading in the red as the broader crypto market feels the pressure of the US-Iran conflict.

Bitcoin’s price has slipped below $71,000, while Ether and XRP are trading below $2,200 and $1.35, respectively.

Solana’s SOL is also underperforming and could face further selling pressure in the near term. The coin is trading at $81 on Monday, after a 4% decline on Sunday, which aligned with the broader cryptocurrency market correction. 

At the moment, Solana remains on a downside trajectory after reversing from an overhead trendline, while institutional demand whipsaws and retail interest declines. Momentum indicators also suggest that sellers are in control, with a possible correction to the $77 support level on the cards.

ETF outflows add selling pressure to Solana

Solana has been underperforming since Tuesday after failing to overcome the $88 swing high level. It lost 4% of its value on Sunday and has continued its poor performance into Monday.

Similar to other leading cryptocurrencies, SOL is facing mixed-to-slightly bearish reactions in the institutional and derivatives markets amid the US-Iran blockade of the Strait of Hormuz. 

Data obtained from CoinGlass revealed that the Solana Exchange Traded Funds (ETFs) recorded $11.5 million in inflows on Friday, limiting the weekly outflow to $5.6 million. Friday’s inflow suggests that institutions remain interested in Solana but also marks the third consecutive weekly outflow.

Furthermore, the derivatives data indicate that Solana is currently underperforming, similar to other major coins. Solana’s futures Open Interest (OI) reads $4.8 billion on Monday, down from $4.9 billion the previous day, suggesting reduced risk appetite among traders. 

Technical outlook: Will the bulls hold the $80 support level?

The SOL/USD 4-hour chart remains bearish and efficient as Solana has lost 5% of its value in the last 48 hours. 

Currently, SOL maintains a bearish near-term bias as its price is below the 50-day Exponential Moving Average (EMA) at $87.43, close to a downward resistance trendline. 

Meanwhile, the 100 and 200-day EMAs are at $99.19 and $118.32, respectively. This reinforces a broader limit to Solana’s recovery efforts. 

Momentum is mixed, with the Relative Strength Index (RSI) hovering at 48 and the Moving Average Convergence Divergence (MACD) line below zero. These indicators suggest that the downside pressure is softening but not yet reversing the overall capped structure.

If the bears remain in control, SOL would drop below the $80 level and find support at the February 5 low at $77.60, which guards the downside toward the February 6 low at $67.50.

On the flip side, a bullish recovery will put the immediate resistance at the 50-day EMA at $87.43, where sellers could look to fade rebounds.

A daily candle close above the 50-day EMA could see SOL rally past the 100-day EMA at $99.19 and the 200-day EMA at $118.32 in the near to medium term.