Solana Faces Critical $120 Support as Breakdown Could Trigger $50 Decline

Key Insights:

• Solana ETFs attracted $674M in 7 days despite weak price action and critical $120 support.
• Solana risks a fall to $50 if the $120 neckline support fails to hold in coming days.
• Active daily traders on Solana drop to 516, signaling low retail engagement across the network.

Solana is currently trading above a key support level that traders are closely watching. While the market shows mixed signals, analysts are warning that a move below $120 could open the way for a sharp drop. The cryptocurrency is showing weak price strength, yet large capital inflows into ETFs suggest growing institutional interest.

Solana Holds $120 Support Amid Bearish Pressure

Solana is holding at the $120 level, which some analysts describe as a macro decision point. The price has been under pressure, with traders now focusing on whether this support can prevent a larger drop.

A crypto analyst Bitcoinsensus noted, “It is key for $SOL to hold the 120$ neckline support.” 

If this level breaks, market participants expect a sharp move to the downside, with $50 mentioned as the next possible level. Price movement around this zone could determine short-term direction for Solana.

Institutional Demand Grows

While Solana’s price struggles near its support zone, data from ETF flows show strong buying activity. U.S.-listed Solana ETFs have seen seven straight days of net capital inflows. These funds brought in a total of $674 million over the past week, with $16.6 million entering on the biggest single day.

Giannis Andreou commented on the trend that Solana ETFs just sent a signal the market chan`t ignore” He also added that while the price is weak, “Institutional demand isn’t.” This type of demand often reflects long-term investor interest and may not match short-term price trends.

Daily Active Traders on Solana Drop

While capital flows into ETFs have increased, user activity on the Solana blockchain has declined. According to recent data, the network now has only 516 active daily traders. This number reflects a major drop in retail engagement compared to earlier periods in the year.

Low trading activity could signal caution among smaller investors. It may also suggest that many are waiting to see if Solana can hold its current price range or if further declines are ahead. 

As of press time Solana is trading at $132.74, showing a slight rise of 1.13% over the last 24 hours. However, with price action still near the $120 support, traders remain alert to any sudden movement. With trading volume reaching $2.8 billion in the last 24 hours, market participants are closely tracking what happens next.