Key Insights
- Solana surged over 30% in a month and outperformed Bitcoin and Ethereum.
- On-chain signals are showing that long-term holders are reducing exposure, which is a hint of weakness.
- Analysts are eyeing a possibility of either a crash or a rise to $1,000 if bullish strength is enough to break resistance.
Solana’s price action has been one of the most discussed topics this week. The token has gained more than 30% since early August, and is outperforming both Bitcoin and Ethereum.
The cryptocurrency now trades at around $210. However, signs of profit-taking and slower network activity are raising issues about how sustainable this rally is.
Solana Price and the Profit-Taking Threat
$SOL has climbed over the last few weeks. And yet, the asset is still showing signs of vulnerability.
For example, the Net Unrealised Profit/Loss (NUPL) ratio shows that holders are sitting on massive gains. This tends to trigger a wave of selling as investors rush to lock in profits.
Recent data indicate that NUPL jumped from 0.26 to 0.30, which is a level that has historically come before corrections. For instance, at the end of August, Solana dropped 4% when NUPL peaked.
Analysts are now warning that a similar pattern may play out again if sellers move quickly.
Particularly, analyst CryptosBatman noted that Solana currently trades at a support level, which used to be a weak resistance. This said, the analyst noted that SOL is likely to head lower and hit the next fair-value gap around $203.
He finished by saying that the cryptocurrency needs to do this to complete its ongoing head and shoulders pattern. This said, a rebound is likely to result from this price level.
Long-Term Investors Reduce Exposure
Another warning sign is coming from Solana’s long-term holders. The net position change for these investors has turned negative so far, after falling below -1.5 million SOL.
This indicates that veteran holders are selling into strength. This means that they are reducing exposure just as prices move higher.
Such selling can be a major hindrance to the effects of bullish trends over the short term. Put simply, without long-term confidence, rallies tend to fail at holding momentum.
Solana currently trades in a range between $205 and $215. Despite the strong rally in August, the token has not managed to break convincingly above this zone.
Analysts are pointing out the $215 to $220 zone as an important resistance area. A move beyond it could unlock more upside, while failure may result in fresh selling pressure.
The Path to $1,000 Solana Price
Technical analysis shows that Solana has a bright future ahead of it. The weekly charts, for example, show that the asset is trading within a broadening wedge (also known as a megaphone pattern).
This means that a confirmed breakout above $330 could trigger a move toward $1,000.
The Relative Strength Index has also climbed from 49 to 61 and is showing strength.
Meanwhile, Futures data adds fuel to the bullish case. According to data from Coinglass, Solana’s open interest has reached an all-time high of $13.7 billion.
Rising open interest historically shows strong speculative activity, which tends to come before large price swings.
Balancing Risks and Opportunities
The Solana price is standing at a crossroads. On one hand, technical setups, ETF filings and treasury inflows support a bullish comeback, and possible targets sit near $1,000.
However, on the other hand, profit-taking signals, long-term holder exits and weak on-chain data indicate risks of a correction.
For traders, the $215 to $250 zone is well worth watching. Breaking through could extend gains, while rejection could invite deeper pullbacks. The next few weeks will determine whether Solana builds on its rally or faces another round of selling.
Ivan Petrov is a seasoned journalist with deep insights into Russia’s dynamic crypto landscape. His work focuses on market dynamics and the transformative potential of blockchain technology, making him a go-to expert for understanding Russia’s digital financial innovations.
