Solana Faces Bearish Pressure as Price Drops and Large Holders Decline

• Solana trades in a descending channel, with bearish momentum persisting after a mid-January peak.
• Large SOL holders decreased by 2.24% in two weeks, signaling reduced accumulation amid market corrections.
• The upcoming 11.2M SOL unlock raises liquidity concerns, potentially impacting price stability in the near term

Solana has experienced a decline in price and market participation, with multiple factors contributing to its downturn. Analysts report a recent rug pull involving LIBRA and an upcoming 11.2 million SOL unlock on March 1, raising liquidity concerns.

Market Performance and Trading Trends

Axel Adler Jr. reported that Solana’s price has been trading within a descending channel, indicating a sustained downtrend. After an upward movement in early January, the asset reached a local peak in mid-January. However, bearish momentum followed, leading to a consistent decline in price. Lower highs and lower lows have defined Solana’s price movement, reinforcing selling pressure. The downward trajectory continued throughout February, with traders reacting to market conditions.

Besides the price decline, trading volume has also fluctuated. During the initial bullish phase, volume spiked, reflecting increased market participation. But the volume steadily decreased as selling pressure increased, suggesting less buying activity. A 47% decline in trade volume was noted by Raydium, a DEX based in Solana, indicating changes in trading patterns.

Decline in Large Wallet Holders

Over the last two weeks, there has been a 2.24% drop in the number of Solana addresses with at least 100 SOL. This number dropped to 151,184 from 154,653. The continuous price correction and the drop in major holders point to shifts in investor accumulation habits. Historically, periods of strong accumulation have aligned with price uptrends, while distribution phases have correlated with market corrections.

Ali Charts reported this decline in large wallet holders, aligning it with shifts in investor behavior. As the unlocking of 11.2 million SOL approaches, liquidity conditions remain a factor. Investment firms Galaxy, Pantera, and Figure currently own these coins, which were sold during FTX’s bankruptcy. In line with current market patterns, Solana’s price could be impacted by any sizable sell-off.

Price movement, variations in trade volume, and changes in wallet distribution are all still reflected in market data, which sheds light on Solana’s present circumstances