SOL may drop below $80 amid ETF outflows and bearish derivatives data

The cryptocurrency market has switched bearish over the past 24 hours following the excellent start to the week.

Solana’s SOL has extended its correction by losing nearly 3% of its value since Wednesday.

At press time, SOL is trading at $82 after being rejected from key resistance the previous day. 

In addition to that, institutional demand continues to weaken, as SOL spot Exchange Traded Funds recorded an outflow on Wednesday, following the largest single-day withdrawal since their launch. 

The declining retail demand indicated by weakening derivatives data also suggest further losses in the near term. 

Institutional demand shows signs of weakness

SOL is down by 2.8% in the last 24 hours and is now trading at $82 per coin.

The bearish performance comes as institutional demand for SOL continues to decline. 

Data obtained from SoSoValue revealed that SOL ETFs recorded an outflow of $1.92 million on Wednesday.

Following a $15.40 million withdrawal the previous day, the largest single-day withdrawal since their launch. 

If the outflows continue and intensify, SOL could extend its correction further, with the $78 support level a likely price magnet. 

The derivatives data also support the strong bearish bias in the market. According to data from CoinGlass, Solana’s long-to-short ratio reads 0.96 on Thursday.

This ratio  declining below one reflects bearish sentiment in the markets, as more traders are betting on the asset price to fall.

Furthermore, SOL funding rates data have flipped to negative on Thursday, reading -0.0003%, indicating that shorts are paying the longs and projecting a bearish outlook.

SOL could dip below $80

The SOL/USD 4-hour chart has flipped bearish after facing rejection from a key resistance zone.

It is currently trading below the 50-day Exponential Moving Average (EMA) at $88.08 and the 100-day EMA near $100.19, keeping the bearish near-term bias in place.

The 200-day EMA is around $120.99 and the horizontal barrier at $120.00 reinforce the broader topside cap.

The momentum remains bearish, with the Relative Strength Index (RSI) on the 4-hour chart hovering around 53, just above the neutral 50 level. 

The Moving Average Convergence Divergence (MACD) is only modestly positive, suggesting that rebounds are likely to face selling pressure at overhead levels. 

If the bulls regain control, they would likely face an initial resistance at the 23.6% Fibonacci retracement at $86.67, followed closely by the 50-day EMA at $88.08.

An extended bullish rally would bring the $92.11 resistance level into focus. The 200-day EMA will continue to keep the 4-hour structure bearish until it is flipped.

On the downside, if the bearish trend persists, the bulls would need to defend the first major support level at $77.12.

A daily candle close below this level suggests a deeper correction toward the Fibonacci anchor at $67.50.