Solana (SOL) Rebounds 30% from Recent Lows, But Caution Remains Warranted

Solana has experienced a strong rebound from recent lows, climbing approximately 30% from its April 7 low of $95 to reach $125.

Solana (SOL) has experienced a strong rebound from recent lows, with prices rising approximately 30% from an April 7 low of $95 to reach highs of $125.

This recovery comes amid mixed signals from both on-chain data and ecosystem activity. The current rally has brought renewed optimism to SOL holders. However, several indicators suggest that the crypto could face resistance in the $140 zone, where many holders might be enticed to sell.

On-chain data reveals concerning behavior from a major holder that could impact SOL’s continued upward momentum. The holder liquidated 274,188 SOL at an average price of $108, realizing an $11 million loss based on their initial cost basis of $148.

Key Resistance Levels

The UTXO Realized Price Distribution (URPD) identifies three major supply clusters for Solana – around $100, $120, and $140. The $140 zone appears particularly critical, with over 27.8 million SOL concentrated at this level, representing approximately 4.75% of the total circulating supply.

This concentration creates a substantial resistance barrier, as many holders at this level are either near breakeven or facing unrealized losses. Should SOL approach this threshold, increased selling pressure could emerge as investors seek to exit positions.

Between $117 and $120, another 38 million SOL sits clustered, creating a potential area for profit-taking as prices move through this range. These supply zones suggest that price volatility may continue until SOL tests and potentially breaks through the $140 level.

Derivatives Market Activity

The recent 7.07% daily upswing positions Solana as the leading top-tier asset in recovery velocity. This rally shows strength in both spot and derivatives markets, with Open Interest jumping 13.89% to $5.23 billion.

This influx indicates that fresh leveraged exposure is entering the market, which could amplify price swings. However, it also contributes to increased market fragility.

The combination of active whale distribution and Short-Term Holders (3–6 months) remaining in capitulation territory creates conditions for potential liquidation cascades. Should Solana fail to maintain its upward momentum, a long squeeze could trigger sharp downside movements.

This risk is heightened by funding rates beginning to skew positive, which might encourage more traders to open long positions. The recent breach of the $117-$120 supply zone further compounds this risk, as it could attract technical traders and generate additional buying pressure.

Ecosystem Strength

Despite price concerns, Solana’s network activity shows positive trends. The blockchain processed over 350 million transactions in the past week, representing a 4.8% increase from the previous period.

Active addresses have jumped by 15% to over 28.13 million, showcasing growing user engagement. Decentralized exchanges on Solana have handled over $14 billion in transaction volume over the past week and $46 billion in the last month.

Major platforms like Orca, Raydium, and Pump have driven much of this activity. Transaction volume on these exchanges peaked at $9.9 billion on April 6.

The Solana meme coin sector has shown particular strength. Tokens like Fartcoin (+81% weekly), Popcat (+57% weekly), Gigachat, Goatseus Maximus, Fartboy, and Vine have all posted strong gains.

Their combined recovery has pushed the total market capitalization of Solana meme coins above $7.02 billion. From a technical perspective, Solana has formed a falling wedge pattern, which often signals a bullish reversal.

Both the Relative Strength Index and MACD indicators have been rising this week, further supporting the case for continued upward movement.

If this bullish scenario plays out, the next key level to watch is $150, representing a potential 20% gain from current prices. However, a drop below $110 would invalidate this outlook and potentially signal renewed bearish momentum.