Will Solana Price Fall Below $80 Support as Bearish Double Top Indicates Possible Breakdown?
Solana’s price is approaching a major breakdown below $80, as a bearish double top pattern suggests a possibility of further declines.
Summary
- Solana’s price has retreated toward the $80 support level following the emergence of a bearish double top pattern near the $98 resistance level.
- Pump.fun has resumed significant selling of SOL, while a staker who locked in for five years liquidated around $137.7 million in tokens amidst the recent downturn.
- CoinGlass data highlights important liquidation clusters around $84 and $88, with analysts warning that a breakdown could push SOL down to the $75 region.
As per reports from crypto.news, on May 28, Solana (SOL) experienced a 5% drop, hitting an intraday low close to $80 after previously staying above $95 earlier this month. It has now reversed nearly all of its late-April recovery, with daily trading volumes rising sharply as traders rushed to exit leveraged long positions.
The recent sell-off intensified following Bitcoin (BTC) falling below $73,000 and Ethereum (ETH) dropping under $2,000 amidst a broader market correction spurred by increasing tensions between the U.S. and Iran.
Concerns over possible supply disruptions in the Strait of Hormuz have caused a spike in oil prices, reigniting inflation fears and reducing interest in high-risk assets like Solana.
On-chain activity has added further pressure. Pump.fun, a leading meme coin launchpad on Solana, has resumed large treasury sell-offs after a period of dormancy. According to Lookonchain data, the platform sold approximately 100,628 SOL at an average price near $84.5, increasing supply in an already fragile market.
Institutional interest has also sharply declined since early May. Recent disclosures revealed that Goldman Sachs has entirely exited its Solana ETF exposure during the most recent reporting period, removing a crucial bullish narrative that had previously supported the token.
This liquidation coincided with a slowdown in spot Solana ETF flows across various U.S. products following weeks of reduced crypto allocations from major asset managers.
In the derivatives markets, sellers continue to dominate. CoinGlass liquidation data indicates significant leverage clusters around $83 and $84 over the past 24 hours, with another notable concentration near the $88 mark. The inability to reclaim these levels triggered cascading stop-loss liquidations, accelerating SOL’s decline beneath short-term support.
Open interest in Solana perpetual futures has also declined during this most recent correction, indicating that traders are closing leveraged long positions rather than initiating new bullish ones. Funding rates across major exchanges have become increasingly negative, suggesting that short sellers are continuing to pay premiums to maintain their bearish positions.
Crypto trading group AltCryptoGems warned that Solana’s chart structure has significantly weakened after experiencing repeated rejections near the $98 level.
“SOL appears notably weak. After being rejected at $98, the price has entered a consistent downtrend. Key levels like $88 have now become resistance,” the analysts stated on X.
They further indicated that if sellers maintain control of the current consolidation range, a move toward the $76 support level could follow.
Charts show bearish double top and critical support breakdown
The daily chart indicates Solana is forming a bearish double top pattern following two rejections near the $98 resistance in March and May. This pattern has developed just below the 0.786 Fibonacci retracement level at $93.7, and the repeated failures from that area have diminished bullish momentum throughout the broader recovery trend.
A breakdown below the neckline support around $81 now sets a measured downside target between $75 and $76, coinciding with the lower boundary of Solana’s multi-month consolidation channel. TradingView data indicates SOL has already dipped below the 0.236 Fibonacci retracement level at $81.1 during intraday trading.
The 20-day moving average has also fallen below short-term price movements, while SOL trades beneath the 50-day moving average around $86.5. Prior attempts to reclaim these levels have faltered quickly, allowing sellers to retain control over short-term momentum.
Concurrently, a descending resistance trendline from the March highs remains active. Each rebound attempt since late April has led to lower highs, reinforcing the ongoing downtrend structure on the daily time frame.
Another bearish signal has emerged from long-term market structure evaluations shared by Solana Media. The analyst pointed out the potential formation of a triple top, spanning late 2024 through 2026, following SOL’s loss of a critical horizontal support zone earlier this year.
“The breakdown from a previously established support range carries significant implications for the price, which is currently consolidating beneath a notable resistance level, indicating a possible shift in market sentiment,” stated Solana Media.
They also remarked that this recent breakdown could leave the token more vulnerable to further declines if macro conditions worsen.
Liquidation zones and macro risks keep traders cautious
Analysis of the liquidation heatmaps suggests high price volatility for SOL may persist in upcoming trading sessions. CoinGlass data reveals significant groups of leveraged short positions near $84 and $88, with sizable long liquidation zones established below $79.
A decisive breach below the current support could trigger another wave of forced selling toward the mid-$70 range.
Meanwhile, macroeconomic conditions continue to heavily influence cryptocurrency markets. Rising crude oil prices have complicated prospects for Federal Reserve rate cuts later in the year, especially given that recent U.S. inflation data continues to surpass targets.
Surging energy costs have historically diminished liquidity in speculative markets, often leading altcoins to experience sharper declines compared to Bitcoin during periods of macro pressure.
Solana’s high-beta characteristic has intensified these movements. While Bitcoin dropped approximately 4% during the recent market decline, Solana fell over 15% from its May peak in the same period, underperforming many large-cap cryptocurrencies.
Nevertheless, traders are focused on the $80 level as the most crucial short-term support. A recovery above $84 could allow SOL to revisit the $88 resistance area where substantial short liquidations are positioned.
However, failing to maintain current levels may subject the token to a faster decline toward the $75 support band that analysts and derivatives traders are closely watching.
Disclosure: This article does not constitute investment advice. The content and materials presented on this page serve educational purposes only.
