Solana (SOL) has been facing a significant decline, with its price dropping by almost 5% in the past week. There are several reasons why Solana’s price is down today, including bearish signals from the SOL/BTC and SOL/ETH pairs. These pairs have shown that Solana is underperforming compared to Bitcoin and Ethereum, with investors favoring these cryptocurrencies over Solana.
The SOL/BTC chart demonstrates a consistent pattern of lower highs and lower lows, indicating a downtrend. The pair has recently fallen below the 0.0021 BTC support level, further suggesting that investors are shifting their capital towards Bitcoin. Similarly, the SOL/ETH pair has seen a significant decline, losing ground against Ethereum. This trend could be attributed to the hype surrounding the launch of the Spot ETH ETF, which has attracted buyers to Ethereum.
Furthermore, the funding rate and open interest charts also reflect a bearish outlook for Solana. The open interest in SOL futures has decreased from over $3.5 billion to under $2 billion, indicating a decline in speculative activity. The funding rate has also shown fluctuations, with recent spikes in negative territory. This suggests that short positions are paying long positions, indicating a bearish sentiment among traders.
Additionally, Solana’s price has broken below a bearish technical pattern known as the descending triangle. This pattern features a downward-sloping upper trendline and a flat lower trendline, indicating intensifying selling pressure. If this bearish setup is confirmed, Solana’s price could potentially drop over 32% to reach a projected price target of around $84.4.
Overall, the combination of bearish signals from the SOL/BTC and SOL/ETH pairs, along with the funding rate and open interest charts, as well as the breakout from the descending triangle pattern, contribute to Solana’s downward price trend.