The price of Solana (SOL) has dropped below $200 following a series of negative events, including the Libra token rug pull and an imminent SOL token unlock that could increase selling pressure. With a key support level at $180, investors are questioning whether SOL can recover or if it will drop further to $135.
Factors Impacting Solana (SOL)
Recent price declines stem from multiple factors driving market uncertainty:
- Libra rug pull controversy: The sudden liquidity removal eroded trust in Solana’s ecosystem.
- Loss of $200 psychological support: Breaking this level triggered additional sell-offs.
- Decline in DEX trading volume: Solana’s decentralized exchanges saw a 25% drop, with Raydium plummeting 47%.
- Unlock of 11.2 million SOL on March 1: This could intensify selling pressure.
- Weakening network activity: Wallets holding 100+ SOL decreased by 2.24% over two weeks.
Downtrend Tests $180 Support
From its recent all-time high of $295, SOL has trended downward, hitting $182. A slight intraday rebound of 1.34% brings the current price to ~$185. However, breaking a critical trendline has traders concerned.
👉 Is now the right time to buy SOL?
The $180 support is pivotal. Holding this level may present a buying opportunity, while a breakdown could push SOL toward $161, $150, or even $135.
Can $180 Support Hold?
Despite bearish signals, some indicators suggest potential stabilization:
- Bullish RSI divergence: Relative Strength Index shows room for recovery.
- Intraday rejection at lows: Repeated bounces at $180 indicate buyer interest.
- Growing accumulation: Traders are buying SOL at current levels.
Impact of the 11.2 Million SOL Unlock
The March 1 unlock—originating from FTX’s bankruptcy and acquired by Galaxy, Pantera, and Figure—could flood the market, exacerbating downward pressure. Coupled with reduced DEX activity, SOL’s short-term outlook remains bearish.
Analyst Ali Martinez notes a 2.24% drop in wallets holding 100+ SOL, signaling declining investor confidence.
Key Levels to Watch
- Resistance: $200 (psychological barrier), $210 (38.2% Fibonacci retracement).
- Immediate support: $180.
- Critical fallback levels: $161, $150, $135.
FAQ
Why is Solana’s price dropping?
SOL faces selling pressure from token unlocks, reduced DEX activity, and eroded trust due to the Libra rug pull.
What happens if $180 support breaks?
A breakdown could lead to further declines toward $161 or $135.
Is SOL a good buy now?
Short-term traders may find rebound opportunities, but long-term investors should monitor market conditions.
👉 Explore Solana trading strategies
Conclusion
Solana’s fate hinges on the $180 support. While technical rebounds are possible, the token unlock and weak network metrics pose risks. Investors should proceed cautiously in this volatile climate.