Solana ETF Inflows Plunge 98% but SOL Holds Support

Solana's native token, SOL, is holding steady around $120 after a four-day winning streak, but the cryptocurrency faces a challenge from weakening demand for Solana-focused exchange-traded funds (ETFs). Despite the drop in ETF inflows, SOL remains above key moving averages on the four-hour chart, maintaining a mildly bullish technical outlook. However, the price is nearing the boundaries of a tightening triangle pattern, which traders are closely monitoring for a potential breakout.

Last week, Solana ETFs saw a dramatic 98.7% decline in net inflows, falling to just $2.43 million from $188.22 million the previous week. Although this marks the 14th consecutive week of positive inflows, the sharp slowdown suggests waning momentum. The data indicates that while demand has slowed, there have been no net withdrawals from the funds. This distinction is crucial, as it suggests a temporary pause rather than a broader retreat.

Despite the softer ETF demand, Solana's network activity remains robust. According to SolanaFloor, the network's decentralized exchange volume on Sunday surpassed the combined volume of Ethereum's mainnet, Layer-2 networks, and Hyperliquid. Additionally, tokenized-stock trading on Solana exceeded $4.4 billion, indicating growing interest in blockchain-based exposure to traditional equities. These metrics suggest that ecosystem participation continues, even as ETF investment moderates.

Technically, SOL is positioned above its 50-, 100-, and 200-period exponential moving averages, with immediate support near $119.16 and resistance around $123. The Relative Strength Index (RSI) and Moving Average Convergence Divergence (MACD) indicators suggest a modest bullish bias, favoring a cautious upward move. The next key resistance levels are September's high at $124.95 and a Fibonacci projection target of $132.87. However, a decisive breakout remains uncertain, as the current consolidation phase could lead to either a bullish or bearish resolution.