TLDR

SOL is the only top 10 cryptocurrency with a negative funding rate (-0.0002%)
Long-term active addresses continue to grow, showing persistent user confidence
Solana has been consolidating around the $175 supply zone for about two weeks
A cup and handle pattern has formed, suggesting potential for a breakout
Spot taker volume is shifting in favor of buyers, indicating bullish momentum

Solana has positioned itself at a critical juncture in the cryptocurrency market. As of May 28, 2025, SOL stands out as the only top 10 cryptocurrency (excluding stablecoins) with a negative funding rate, registering at -0.0002%. While this figure appears small, it might indicate building pressure on the short side of the market.

Funding rates serve as indicators of sentiment in derivatives markets. When these rates turn negative, it means short sellers are financing long positions, which typically suggests a mild bearish tilt. For Solana, this drop remains shallow but notable compared to the broader market, where most assets have maintained positive or neutral funding rates recently.

Despite this short-term metric, Solana’s on-chain activity paints a more favorable picture. Long-term active addresses have continued their upward trajectory, demonstrating persistent confidence from committed users and investors in the network.

This growing user base points to a healthy ecosystem that can potentially support price increases over the long term. It also suggests that the broader community remains active and engaged, even as some traders hedge short positions.

From a technical perspective, Solana’s price has been consolidating around the $175 level for approximately two weeks. This zone has functioned as a key supply area where bears have executed several sell orders, accompanied by increasing trading volume.

Solana Price on CoinGecko

SOL has repeatedly tested this region in a choppy pattern without achieving a successful breakout. The extended consolidation, ongoing since May 9, indicates that market participants on both sides are waiting for stronger signals before committing to either direction.

Technical Analysis Points to Potential Breakout

The formation of a cup and handle pattern on Solana’s chart suggests a potential breakout beyond the $180 resistance level in the coming weeks. If this pattern plays out as expected, the resulting movement could be explosive, potentially driving SOL toward new all-time highs.

In recent days, the price action has shown repeated rejections at the $180 resistance level. Like many altcoins, Solana has experienced weakened bullish momentum over the past two weeks.

However, several indicators remain positive. The Chaikin Money Flow (CMF) indicator shows positive capital inflows, while the On-Balance Volume (OBV) indicates that despite resistance rejections, selling pressure has not become overwhelming.

The moving averages further support bullish momentum, suggesting buyers may soon gather enough strength to push prices beyond the critical $180 level.

Whale Activity and Market Dynamics

The spot average order size, calculated by dividing total trading volume by executed trade count, has not shown significant spikes in whale activity despite bulls’ persistent efforts to breach the $180 mark. This might indicate that larger holders are anticipating further price gains before making significant moves.

Over most of May, the spot taker Cumulative Volume Delta (CVD) has remained neutral. However, on May 25, the metric signaled that taker buy volume became dominant. While this represents just the beginning, a sustained trend of buyer dominance in the taker CVD would signal the potential for a strong rally ahead.

The last instance of buyer dominance in this metric occurred in mid-November, when Solana climbed above the same $180 level after forming a nine-month range below this critical resistance point.

Despite short-term caution signals from the funding rate and resistance at $175, Solana’s overall market structure remains bullish. Price action on longer timeframes suggests that bulls maintain control of the broader trend.

The continued activity from long-term investors further strengthens this bullish outlook. While short-term metrics warrant caution, the overall picture for SOL continues to favor potential price appreciation.

For now, the $180 level remains the key hurdle for Solana to overcome. A decisive break above this resistance could trigger the next significant leg up in Solana’s price journey.

The post Solana (SOL) Price: Consolidating Near $175 While Showing Mixed Market Signals appeared first on Blockonomi.

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Filed under: Bitcoin - @ May 28, 2025 8:17 am