Persistent selling pressure sends Solana down

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Solana drops 2.12% today to $80.88

Highlights

Solana activated a resource-based burn mechanism via SIMD-547, immediately increasing its daily token burn rate and impacting SOL supply dynamics.
The Alpenglow consensus upgrade launched on a community validator cluster for testing, signaling upcoming protocol changes despite continued selling pressure.
SOL trades below key moving averages, with persistent bearish momentum and an expected trading range of $77.00 to $85.00 over the next five days.

Token economics shift as burn mechanism and network upgrade take effect

Solana entered a live network governance phase as co-founder Anatoly Yakovenko supported the implementation of the SIMD-547 proposal, which introduces a resource-based burn mechanism on computationally expensive transactions and raises the daily token burn rate. This move immediately alters the circulating supply of SOL, shifting the network's underlying economic model. In parallel, the Alpenglow consensus upgrade was launched for testing on a community validator cluster on May 11, deploying new protocol mechanics ahead of potential mainnet adoption, though price action has remained under broader selling pressure.

Oversold signals and negative momentum as resistance holds

On the technical chart, SOL remains under all major moving averages: SMA-20 is at $85.89, SMA-50 at $86.39, and SMA-200 at $104.48. Key resistance is set by the Ichimoku Kijun on the daily chart at $89.21. Downward momentum is reflected by negative MACD readings on daily and weekly timeframes, while ADX is neutral on D1 but signals a strengthening trend on W1. RSI sits at 40.31 (D1) and 37.24 (W1), suggesting subdued momentum, with Stoch RSI and CCI both indicating oversold conditions. BBP is deeply negative, confirming intraday seller dominance, and the Awesome Oscillator remains negative as well. Price action has remained volatile, covering the lower end of the intraday range ($81.18–$83.03), with no conflicting signals across oscillators and momentum indicators.

Downside risk dominates as volatility bands cap breakout odds

In the next five trading days, SOL is expected to trade within a volatility band of $77.00 to $85.00, consistent with current intraday volatility and recent price action. The probability of a significant price increase remains low, with estimates below 20%, which puts further declines at higher likelihood. The base scenario calls for continued consolidation near current levels. Should a bullish reversal materialize with a close above $89.21, a short-term rally could emerge. Conversely, a breakdown and close below $77.00 would open additional downside risk for Solana.

Anton Kharitonov, expert at Traders Union, sees Solana under continued technical pressure despite the recent move to a live governance phase and immediate introduction of a resource-based burn. He notes the token remains below all key moving averages, with reinforced downside momentum and no conflicting signals from core oscillators. The fundamental shift in tokenomics has not yet driven a sentiment change or halted the prevailing sellers’ control. "Until SOL closes above $89.21, I remain defensive and see further consolidation or downside as the base case."

Earlier, analysts noted that Solana was experiencing continued bearish momentum amid persistent seller dominance and technical weakness. The latest governance changes and protocol upgrades reinforce a cautious outlook, making the $77.00 level a critical threshold to monitor for potential downside acceleration in the immediate term.

Source of Data: SOL Price Analysis by TU

The analysis is based on a proprietary model combining technical, on-chain, and expert data. Not investment advice. See methodology

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