Solana Faces Bearish Outlook Amid Strong Onchain Indicators

According to Cointelegraph, Solana (SOL) is currently experiencing a bearish trend on its daily chart, with projections indicating a potential drop to $120. The formation of a bearish engulfing pattern suggests that if the trend persists, SOL's price could indeed fall to this level. The 1-day time frame reveals a head-and-shoulders pattern, a classic bearish reversal signal. A breakdown below the $140 neckline, confirmed by a volume spike, could lead to further bearish continuation. The downside target from this pattern is approximately $126, supported by an immediate liquidity zone. However, the daily demand zone, marked by an order block between $95 and $120, could be tested in the coming weeks. The bearish outlook for SOL might be invalidated if the price closes above the $157 resistance level. Solana's price movement has shown a strong correlation with Bitcoin, and with Bitcoin potentially retesting support near the $100,000 mark, increased sell-side pressure could result in further corrections for SOL. Despite the bearish chart patterns, onchain data for Solana presents a more optimistic picture. Glassnode reports that Solana's Network Value to Transactions Ratio (NVT) has dropped below 10, its lowest since February 2025. This indicates robust network usage relative to its market value, suggesting long-term potential despite SOL's price fluctuations below $150. Additionally, the Exchange Net Position Change chart shows consistent SOL withdrawals from exchanges, a trend that has recently reversed with SOL moving back into exchanges. This shift indicates growing investor confidence, as holding SOL off exchanges often signals accumulation for future gains. The data reveals a significant net outflow, with peaks of -4.6 million SOL on May 28, followed by a recent increase in deposits, aligning with the current price dip. While Solana's price has experienced volatility, dropping from a high of $295 earlier in 2025, the onchain metrics suggest underlying strength. The stable NVT and increasing exchange outflows underscore robust network activity and investor accumulation, overshadowing short-term bearish price movements. This article does not offer investment advice or recommendations. Every investment and trading decision involves risk, and readers are encouraged to conduct their own research before making decisions.