Overview: Solana at a Critical Juncture
Solana (SOL) is trading near multi-month lows in 2025, prompting heightened attention from traders and on-chain analysts. Recent price action has pushed a large portion of network supply into unrealized losses, while liquidity maps and momentum indicators point to defined upside targets should buyers re-emerge.
This report synthesizes on-chain metrics, liquidity structure, and technical patterns to outline plausible scenarios for SOL over the coming weeks and months. The analysis is intended for informational purposes and does not constitute investment advice.
On-chain Stress: Most Supply Sitting Below Cost Basis
On-chain data shows that roughly 80% of Solana’s circulating supply is currently underwater. That degree of unrealized loss is a common characteristic of deeper corrective phases and typically increases short-term selling pressure as holders reassess positions.
Key implications:
- Forced or panic selling tends to decelerate once a majority of holders sit at a loss, which can create a foundation for stabilization.
- Large unrealized losses increase the likelihood of reduced liquidity from long-term holders, as many wait for a meaningful recovery to exit at breakeven.
- Short-term volatility often remains elevated while the market digests the distribution of unrealized gains and losses across addresses.
Liquidity Map: Clean Upside Pockets at $120 and $145–$150
Liquidity analysis highlights two notable upside clusters for SOL: the $145–$150 range and a zone around $120. The lower band has already seen significant interaction, leaving the higher cluster as a relatively untouched pocket of resting orders.
Why these zones matter:
- Markets frequently move toward concentrated liquidity. If buying momentum returns, SOL could gravitate to the next available pool of resting orders.
- With downside liquidity largely consumed in recent sessions, the path of least resistance may present a cleaner route higher than lower.
- These zones can act as intermediate targets for traders looking for short-term relief bounces or tactical accumulation.
Practical Considerations for Traders
- Traders may use the $120 area as a near-term support reference, given its recent role in absorbing selling pressure.
- The $145–$150 cluster can serve as an initial upside objective for momentum-based strategies.
- Risk management remains crucial: liquidity pools can be swept quickly during periods of elevated market participation.
Momentum Signals: Early Signs of Relief
Momentum indicators on higher timeframes are beginning to display early bullish divergences, while relative strength measures are reflecting oversold conditions. These signals often appear ahead of a visible price reversal and can mark the start of a short-term relief rally.
What the indicators imply:
- Bullish divergences suggest sellers may be losing conviction even if price continues to make lower lows.
- Oversold readings increase the probability of a bounce, particularly when accompanied by recovering volume.
- Confirmation typically requires a pickup in buying activity; without volume, divergences can fail or be prolonged.
Technical Structure: Descending Channel Provides Framework
On the chart, SOL remains confined within a clearly defined descending channel. The price recently reacted from the channel’s lower boundary around $130, a level that has provided multiple bounces in the short term.
Channel-based targets include:
- A retest of the midpoint near $160–$165, which would represent a meaningful short-term recovery if reached.
- An upper channel boundary closer to $200, a more medium-term objective contingent on sustained momentum and broader market support.
Maintaining the lower boundary intact is important for a bullish short-term bias. A decisive breakdown below this support could open the door to further losses and invalidate the channel’s bullish reversal prospects.
Macro and Market Context for 2025
The broader crypto market environment in 2025 exhibits several factors that can influence Solana’s trajectory:
- Bitcoin continues to act as the primary market driver. Episodes of BTC strength historically lift risk-on assets, including SOL.
- Macro variables such as global liquidity, interest rate expectations, and regulatory headlines affect investor appetite for higher-beta tokens.
- Institutional flows and product approvals across jurisdictions remain important sentiment drivers for growth-oriented ecosystems.
For Solana specifically, network developments, NFT and DeFi activity, and performance of Layer-1 competitors will continue to influence on-chain demand and speculative flows throughout 2025.
Scenario Analysis: Paths Forward
Based on the current technical and on-chain picture, several plausible scenarios emerge for SOL:
1) Stabilization and Relief Rally
- Conditions: The lower channel boundary (~$130) holds, momentum indicators continue to improve, and Bitcoin posts a supportive bounce.
- Consequence: Buying interest targets the $145–$150 liquidity cluster, with a potential extension to the channel midpoint near $160–$165.
- Timeframe: Weeks to a few months, depending on volume and macro sentiment.
2) Extended Consolidation
- Conditions: Price remains range-bound between the $120–$160 area as the market digests recent losses and participants reassess positions.
- Consequence: Volatility moderates but upside catalysts are needed for a sustained breakout; traders may rotate in and out of short-term ranges.
- Timeframe: Several weeks to months, often characterized by choppy price action.
3) Renewed Downside
- Conditions: Failure to sustain the lower channel boundary and renewed macro risk aversion (e.g., rapid BTC drawdown or negative headlines).
- Consequence: SOL could seek deeper support levels, and short-term liquidity gaps may accelerate declines until new accumulation occurs.
- Timeframe: Rapid moves are possible; downside momentum can intensify if broader markets turn negative.
Risk Factors and Considerations
Market participants should weigh the following risks when assessing Solana’s short-term outlook:
- Correlation with Bitcoin: SOL’s path is often correlated with BTC performance, making BTC’s directional moves a major influence.
- Liquidity concentration: High concentrations of orders at specific price levels can be swept quickly during volatile sessions.
- On-chain events: Network upgrades, outages, or security incidents can materially affect sentiment.
- Macro shocks: Interest rate surprises, geopolitical developments, or regulatory actions can provoke swift reassessments across risk assets.
What Traders and Investors Can Monitor
To navigate the current environment, market participants may track the following indicators and data points:
- Realized supply vs. market price to monitor changes in unrealized losses across holders.
- Liquidity heatmaps to observe where resting orders cluster and where potential stops are located.
- Momentum oscillators and RSI on higher timeframes to identify persistent divergences or confirmation of strength.
- Volume trends—both on-chain and exchange traded—to validate any breakout attempts.
- Macro headlines and Bitcoin price behavior, which often set the tone for altcoin performance.
Summary
In 2025 Solana finds itself at a pivotal point: a large portion of circulating supply is at a loss, liquidity analysis points to clear upside pockets at $120 and $145–$150, and momentum indicators show early signs of relief. The descending channel provides a useful structural framework, with the midpoint near $160–$165 serving as a key target if buyers reclaim momentum.
Ultimately, Solana’s near-term path will depend on whether the current support holds and how macro and Bitcoin-related catalysts evolve. Traders should prioritize disciplined risk management and watch for confirmation from volume and on-chain flows before assuming a sustained recovery.
For the latest market updates and trading tools, consider staying informed through reliable exchange resources and regularly reviewing both on-chain analytics and broader market indicators.
Disclaimer: This post is a compilation of publicly available information.
MEXC does not verify or guarantee the accuracy of third-party content.
Readers should conduct their own research before making any investment or participation decisions.
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