 ▲ Solana (SOL) / AI-generated image © |
Despite inflows into spot ETFs, Solana (SOL) is facing up to a further 25% downside risk amid emerging technical weakness, analysts say.
According to investment media outlet FXEmpire on Feb. 17 (local time), SOL is forming a “bear flag” pattern on the four-hour chart. This is a typical bearish continuation structure in which a sharp decline is followed by a temporary rebound and consolidation before resuming the prior downtrend. SOL plunged from around $140 in early February to below $80, forming the “flagpole,” and has since been consolidating within a mild upward channel.
SOL is currently trading around $86–$87, remaining below its 50-, 100-, and 200-period exponential moving averages. All three moving averages are sloping downward and acting as dynamic resistance, adding to downside pressure. Analysts warn that a clear break below the lower boundary of the flag near $80 could open the door to a target range of $64–$66, calculated based on the previous decline. This implies roughly 25% additional downside from current levels. Conversely, a sustained move above $92 would invalidate the bearish scenario.
Despite technical vulnerability, fund flows into Solana spot ETFs have shown improvement. According to SoSoValue data, net inflows this week totaled approximately $13 million, bringing total net assets to over $700 million. This suggests that longer-term investors have been accumulating positions in tranches following the recent sharp decline.
However, the capital inflows have not translated into an immediate price rebound. The outlet noted that Solana, as a high-beta asset sensitive to liquidity conditions and growth expectations, tends to react strongly to shifts in overall risk appetite. The recent cooling of investment sentiment surrounding artificial intelligence (AI), leading to so-called “AI fear trades,” has also been cited as a headwind.
Ultimately, while ETF inflows are providing some degree of downside support, they remain insufficient to offset the bearish chart structure and unfavorable macro sentiment. In the short term, whether SOL can defend the $80 support level is emerging as the key inflection point.
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