Solana rising channel may hide 50% sell-off risk

Solana has traded inside an ascending channel since Feb. 6. The channel base is linked to a more than 50% price collapse that occurred from mid-January to early February. SOL was trading around $83.78, roughly 3% above the channel’s lower trendline near $81.24.

A daily close below $81.24 would confirm a breakdown of the channel. If the channel breaks, the first downside target listed on the chart is $76.61. Further technical levels cited are $63.21 and $41.53.

On-chain metrics show a pullback in long-term holder accumulation. The Hodler Net Position Change, which tracks daily changes in supply held by wallets with coins older than 155 days, fell from about 3.2 million SOL on May 25 to roughly 2.78 million SOL on May 26, a decline of about 13% in 24 hours. Hodlers remained net buyers since early March, but the daily accumulation rate slowed as price moved nearer to the channel floor.

Short-term holder measurements also shifted. Short-Term Holder Net Unrealized Profit/Loss (NUPL), a metric for holders with coins under 155 days, read about -0.157. The metric reached a six-month high of -0.03 on May 11. The current reading indicates that many short-term holders are carrying small unrealized losses compared with the deep negative readings seen during February’s drop.

Volume data showed divergence from price action. Buying volume declined steadily since early February even as SOL advanced within the channel. The weaker volume accompanied price highs above $97 and the subsequent drift back to the channel base.

Upside technical levels identified include $84.89, $87.45, $93.17 and $98.29. A daily close above $87.45 has capped recent upside attempts, while a clean break above $98.29 would change the structural picture on the chart.

Price action and on-chain flows are the immediate data points to watch. The channel has higher lows, and the lower trendline is one down day from being tested on a daily close.