Solana is currently trading around $127.7, down more than 12% from its monthly high, and nearly halved from the all-time high set in September. As the seventh-largest asset in the crypto market, SOL is facing a tricky situation — the massive bearish pattern on the chart is becoming more apparent, and several key on-chain indicators are also weakening.

The DeFi ecosystem is shrinking. The total value locked (TVL) in DeFi protocols built on Solana has fallen from $3.51 billion in September to $2.38 billion, evaporating about one-third. More painfully, the transaction fees generated by various protocols on the network have also dropped sharply from $31 million to $8 million during the same period. These data points are clear — on-chain activity is declining, and investor enthusiasm is waning.

Institutional interest is also cooling. According to SoSoValue, eight SOL spot ETFs attracted $199.2 million in capital during their first week of trading, but this momentum has waned, with only $13.1 million recorded last week. The sharp drop in capital inflows from high levels is a clear signal — institutional investors are pulling back, and this attitude could easily spread to retail investors.

**Technical Risk Signals**

On the weekly chart, since mid-2024, Solana has been forming a textbook double-top pattern. Two peaks are separated by a neckline, and once the price breaks below this support line, it usually signals a trend reversal. Currently, SOL appears to be approaching the neckline at $120, with a breakout imminent.

If it truly breaks below, technical analysis suggests more downside potential, especially when momentum indicators like MACD and RSI are also bearish. Both indicators are weakening now, with the bears clearly in control. If the $120 support cannot hold, the next target would be the low of $95 set on April 7. This price level has served as a key bottom support for most of this year.