Solana Attempts Rebound Amid Cooling ETF Flows

Key Moments

Institutional Flows Reflect Mixed Sentiment

Solana (SOL) trades nearly 2% higher at press time on Monday, recovering modestly after four consecutive daily losses. Despite the bounce, technical conditions still point to a consolidation phase with waning buying pressure and a bias that remains tilted to the downside.

In the spot ETF market, institutional participation in Solana is sending a mixed signal. US-listed spot Solana Exchange Traded Funds collectively held roughly $800 million worth of SOL as of Friday. Over the last six months, these vehicles have largely maintained their positions even as Solana’s market capitalization declined by more than 65%, with only two weeks of net outflows that together amounted to roughly $11 million. As of Friday, cumulative net inflows stood at $957 million, implying no major portfolio reallocation during the broader correction.

However, the pattern shifted at the end of last week. Two consecutive daily redemptions of $5.23 million and $8.23 million limited weekly net inflows to $24.05 million. According to the article, these outflows have occurred in an environment of increased downside pressure across the cryptocurrency complex, linked to the US-Iran war and higher oil prices.

The article notes that if Solana ETFs continue to record net redemptions this week, it would signal weakening institutional appetite and could point to increased downside risk for SOL.

Derivatives Market Shows Tentative Risk-On Tone

On the derivatives side, retail participation has increased alongside the early-week price rebound. CoinGlass data cited in the article indicate that Solana’s open interest currently stands at $5.01 billion, up 1% over the past 24 hours. This rise reflects either the establishment of new positions or a buildup in leverage as risk-on sentiment re-emerges.

This positioning shift is accompanied by a less negative funding environment. The funding rate has moved to -0.0006%, from -0.0161% on Sunday, suggesting a reduced premium for holding short positions and a softening of the bearish stance in perpetual futures.

Despite this easing in bearish pressure, the liquidation profile reveals fragility in bullish positioning. Over the last 24 hours, approximately $19.79 million in positions have been forced out, with $15.52 million of that total coming from longs. This imbalance indicates that leveraged bullish traders have borne the brunt of recent volatility and that any renewed upside effort may remain vulnerable.

Technical Picture: Consolidation With Bearish Lean

From a technical standpoint, Solana’s 2% intraday gain on Monday follows a four-day losing streak and takes place within a broader structure that still appears corrective. The article highlights that SOL is currently trading below its 50-day, 100-day, and 200-day Exponential Moving Averages, all of which are sloping downward, reinforcing the prevailing bearish bias.

Price action remains confined to a sideways band defined by the daily open and close of February 5, at $92.11 and $78.35, respectively. The upper boundary of this range at $92.11 coincides with resistance formed by the declining 50-day EMA at $95.82, creating a significant overhead cluster.

The analysis suggests that a break above $95.82 would open the way for a potential extension of the recovery toward – and potentially above – the $100 mark, with the 100-day EMA at $112.80 serving as a further upside reference.

Momentum readings, however, illustrate the challenges facing buyers. On the daily chart, the Moving Average Convergence Divergence (MACD) line remains above its signal line, but the histogram is contracting, pointing to fading bullish momentum in the near term. The Relative Strength Index sits at 43, having turned down from the midline, indicating that sellers continue to exert control.

On the downside, the article identifies $78.35 as the first meaningful support and characterizes it as the final significant buffer before the next notable level at $67.50, which corresponds to the low from February 6.