Solana (SOL) price is showing weakness despite enthusiasm for its ETF. The altcoin has fallen 2.2% in the last 24 hours, trading near $201. Recent data from Glassnode indicates long-term investors are selling. Meanwhile, Solana price analysis on-chain data points to an over-leveraged market.
On-chain indicators reveal growing selling pressure. The “hodler” net position change metric, according to Glassnode, has been negative for three consecutive days, hitting -3.90 million SOL on October 27. This trend shows that long-term wallets are reducing their holdings. At the same time, mid-term holders (3-6 months) are also distributing. Their share of the total supply fell from 12.76% to 11.39% over the last month, a notable 10.7% reduction.
This selling by experienced investors contrasts sharply with derivatives market sentiment. Despite the fundamental weakness, retail traders are becoming overly optimistic. The excitement surrounding the potential launch of a Solana ETF seems to be driving leverage. However, the Solana price analysis on-chain data suggests long-term conviction is cooling. Investors who stabilized previous dips are now securing profits.
Could a $548 Million “Long Squeeze” Send SOL into a Crypto Winter?
The derivatives market presents the most immediate risk. Data from Coinglass, specifically from the Bybit exchange, shows over 80% of positions are long. This represents $884.15 million in long positions versus just $288.42 million in shorts. This imbalance creates a “long squeeze” scenario. If the price drops, these leveraged positions are forced to sell. The critical liquidation level sits at $188. A break below this key support could liquidate over $548 million.
Technically, SOL’s daily chart shows a bearish rising broadening wedge pattern. The RSI (Relative Strength Index) also displays a hidden bearish divergence, suggesting buying momentum is fading. If Solana loses the crucial $179 support, it could trigger mass liquidations. A daily close below this level would expose SOL to tests of $168 or even $155. Conversely, only a sustained daily close above $235 would invalidate this bearish structure and restore confidence in the asset’s economy.
