Key Takeaways
Solana price faces weakness amid validator centralization concerns
Technical rejection at 7-day SMA near $136
Key support level: 23.6% Fibonacci at $132.83
Solana Price Declines Amid Validator Purge Debate
Solana’s latest price update shows the asset slipping about 2% while the broader market dipped 1.02%, highlighting relative underperformance. A sharp decline in the number of active validators, now around 800 and down more than 68% since 2023, has renewed fears over network decentralization and potential regulatory scrutiny.
The Solana Foundation’s “3-in-1-out” pruning policy aimed at removing underperforming nodes has split the community. Some developers argue it eliminates Sybil nodes, while others warn that rising operational costs are driving away genuine operators, lowering validator diversity and increasing potential collusion risk.
Despite these concerns, Solana’s on-chain activity remains strong. The network is still posting $3.9B in 24h DEX volume and rising TVL, but investors appear cautious about governance and infrastructure health.
ETF Flows Trail XRP and Ethereum
In the latest ETF update, Solana spot ETFs recorded $1.18M in inflows, well below the $38M seen for XRP and $35M for Ethereum. This divergence reflects weaker institutional confidence in SOL compared to competitors benefiting from clearer regulatory narratives or staking yield appeal.
Technical Indicators Signal Ongoing Weakness
SOL failed to reclaim its 7-day SMA near $136.23, reinforcing bearish pressure near this key resistance.
Oscillators show largely neutral momentum, with the RSI at 42.56, Stochastic at 41.35, and the Ultimate Oscillator at 41.09. However, the MACD level at −5.36 and Momentum at −2.66 suggest mild upswing potential, but without strong conviction.
All major moving averages, from SMA/EMA 10 through 200, are registering above the current price, indicating persistent downside bias across short- and long-term trends.
SOL Outlook: Key Levels to Watch
With the upcoming FOMC meeting, traders are watching whether rate-cut signals could revive altcoin demand. For now, SOL’s forecast hinges on holding the $132.83 support while navigating heightened debate around validator composition and uneven ETF participation.
A close below the 23.6% Fibonacci retracement at $132.83 could unlock further downside toward the $124 area, while reclaiming $136.23 may hint at stabilization.
