The Solana price approaches the key support zone as the downtrend still dominates

Solana (SOL) dipped into the red, losing about 2% of its value during Thursday’s trading session, accompanied by a broad correction wave across the entire cryptocurrency market following the Federal Reserve’s decision to hold interest rates steady at its Wednesday meeting. Increasing selling pressure reflects the growing cautious sentiment among retail investors, evidenced by a decline in open contracts on the SOL futures market and a shift of the funding rate into negative territory. From a technical perspective, Solana is sending less positive signals, raising the risk that the price could continue to retreat to the support level of $116, or even deeper into the $100 zone in a worst-case scenario.

Weakening retail investor sentiment and factors that could support a recovery

Solana is gradually losing support from retail investors as capital outflows from the derivatives market continue to reinforce risk-avoidance sentiment. Data from CoinGlass shows that the open interest (OI) of SOL futures contracts has decreased by 1.40% in 24 hours, down to $7.42 billion — a sign that a wave of position liquidations or deleveraging is occurring on a broad scale.

This negative development is further intensified by liquidation values of long positions reaching $5.55 million, many times higher than the $1.34 million of short positions at the same time. This reflects the reality that most optimistic bets have been swept away from the market. Meanwhile, the funding rate has turned negative at -0.0042%, indicating that new traders are leaning toward a short position strategy.

SOL Derivatives Data | Source: CoinGlass The declining interest in Solana occurs amid a broad correction in the cryptocurrency market following the Federal Reserve’s decision to keep interest rates within the 3.50%–3.75% range with a 10–2 voting split. Although two members supported rate cuts, the majority of the remaining members chose a “wait and see” stance, fueling expectations that the tightening cycle is gradually coming to an end. The possibility of the Fed starting to cut rates by the end of this year is seen as a factor that could improve liquidity and lay the groundwork for a market recovery.

Additionally, a rearranged meeting between the US government, banks, and crypto industry leaders to discuss the structure of the crypto market is also expected by investors to serve as a positive catalyst, especially if the CLARITY bill is passed.

Technical outlook: Can Solana’s price hold the $116 level?

Solana is still trading below the 50, 100, and 200-day EMAs, indicating that the downward trend continues to dominate the market. At the time of writing, SOL has decreased by about 2% during Thursday’s session, extending the previous session’s decline of over 1%.

The nearest support zone for Solana is identified around the $116 mark — a level that previously acted as a support during Sunday and December 18, helping to contain short-term selling pressure.

From a technical standpoint, the MACD indicator remains below the signal line, but the negative histogram is narrowing, suggesting that the downward momentum is weakening. Meanwhile, the RSI is around 40 and turning away from the neutral line, reflecting a still-weak market condition and indicating room for further decline before entering oversold territory.

Daily SOL/USDT Chart | Source: TradingView In a negative scenario, if SOL decisively closes below the $116 support level, the price could continue to slide toward the psychological zone of $100, or even further down to $95 — the area coinciding with the bottom set on April 7.

Conversely, any recovery attempt will face several significant barriers, starting with the 50-day EMA at $133, followed by the 100-day EMA around $144, close to the strong supply zone of $145–$148.