Solana Sell-off: Why Price Refuses to Break

January 23, 2026 Ananya Sharma 0 Comments

Solana Sell-off pressure has intensified recently, yet the asset’s price continues to hold within a defined range rather than breaking down or rallying higher. Despite a major long-term holder gradually exiting a large position, Solana has shown notable resilience. This behavior suggests that strong buyer absorption is countering sell pressure, keeping price action compressed and directionless for now.

Solana Sell-off shown on 1-month price chart as SOL consolidates within a tight trading range

Viewed over the past month, Solana’s price action reinforces the idea of compression rather than trend. The chart shows repeated reactions around the same highs and lows, with neither side sustaining follow-through for long. Rallies fade quickly, but pullbacks are also met with steady buying, suggesting that participants are responding more to levels than to momentum. This kind of structure often reflects a market focused on balance and positioning, where price discovery slows as traders wait for stronger signals to emerge.

Solana Sell-off and the 98K SOL Distribution

The current Solana Sell-off is driven by a whale that unstaked and began selling more than 98,000 SOL tokens. These tokens had been staked for nearly two years, meaning the holder originally accumulated them at significantly higher prices. As a result, the ongoing sell-off is being executed at a substantial realized loss.

Instead of dumping all tokens at once, the seller adopted a gradual distribution strategy. This dollar-cost averaging approach spreads supply over time, limiting sudden shocks to the market. While this method reduces volatility, it still introduces persistent sell pressure that prevents Solana from gaining strong upward momentum.

This steady supply has become a key factor shaping current price behavior. Although it has not triggered a sharp crash, it has clearly capped upside attempts, forcing the market into consolidation.

Solana Sell-off Keeps Price Trapped in a Range

Despite the ongoing Solana Sell-off, price action remains locked between clear support and resistance levels. Buyers continue to defend the lower demand zone around the $120 to $125 region. Each time price approaches this area, buying interest emerges, preventing deeper declines.

On the upside, the $146 to $150 zone has consistently acted as resistance. Every attempt to push beyond this level has failed, with price quickly retreating back into the range. As a result, Solana has been oscillating around the midpoint near $135, which has alternated between support and resistance.

This range-bound structure reflects a market in balance. Neither buyers nor sellers have enough dominance to force a breakout. Instead, price compression continues as both sides absorb liquidity without committing to a clear direction.

Momentum Weakens Without Turning Bearish

Momentum indicators confirm the consolidation narrative surrounding the Solana Sell-off. The Relative Strength Index has declined from earlier highs and now sits below the neutral 50 level. However, it remains well above oversold territory.

This positioning suggests that bullish momentum has weakened but has not completely collapsed. Sellers are active, but they are not overwhelming the market. At the same time, buyers are cautious, stepping in only at key support levels rather than aggressively chasing price higher.

As long as momentum remains in this neutral zone, the probability of continued sideways movement stays elevated.

Buyer Absorption During the Solana Sell-off

One of the most important dynamics during the Solana Sell-off is how effectively buyers are absorbing sell pressure. Data shows that spot market takers have been consistently buying, even as the large holder continues distributing tokens.

This behavior indicates accumulation rather than panic selling. Buyers are willing to take the supply being offered, but they are doing so at controlled price levels. Instead of driving price upward, this demand is simply preventing further downside.

This type of absorption often leads to extended consolidation phases. The market digests supply slowly, allowing weaker hands to exit while stronger hands accumulate without pushing price too far in either direction.

Trader Positioning Reflects Cautious Optimism

Derivatives data reveals that top traders remain largely bullish despite the Solana Sell-off. Long positions significantly outweigh shorts, suggesting that many traders still expect higher prices over time.

However, the high concentration of long exposure has not resulted in a breakout. This disconnect implies that bullish expectations alone are not enough to overcome the steady supply entering the market. Traders may be positioned for upside, but price structure continues to limit follow-through.

Interestingly, long dominance has eased slightly in recent sessions. This reduction suggests some traders are trimming exposure rather than aggressively adding, reinforcing the idea that conviction is present but restrained.

Editor’s View: Why the Solana Sell-off Feels Different This Time

What stands out in this Solana Sell-off is not the size of the distribution, but the absence of urgency on both sides of the market. The seller is unwinding patiently, and buyers are responding with equal restraint rather than aggressive bids. This suggests a market that has already internalized the downside risk and is now focused on price acceptance rather than short-term direction. When participants behave this way, it often reflects fatigue rather than fear, with capital waiting for clearer confirmation before committing further.

What the Solana Sell-off Means Going Forward

The ongoing Solana Sell-off highlights a market stuck in equilibrium. Long-term holders are exiting positions gradually, creating constant overhead pressure. At the same time, buyers are absorbing this supply near key support levels, preventing a breakdown.

For Solana to escape this range, one side must gain control. A decisive break above the $146 to $150 resistance zone would signal that demand has finally overwhelmed sell pressure. Such a move could open the door to renewed upside momentum.

Conversely, a breakdown below the $120 support area would indicate that buyers have stepped aside, allowing sellers to push price lower. This scenario could lead to increased volatility and a deeper correction.

Until one of these outcomes materializes, Solana is likely to remain range-bound. The current structure favors patience, with price action defined by absorption, distribution, and cautious positioning rather than aggressive trend moves.

Disclaimer: This content is for informational purposes only and does not constitute financial advice.

Keep yourself updated with the latest crypto news with FYI Gazette

Keep yourself updated with the latest Altcoin News with FYI Gazette