Solana Faces Bull Trap as 50% of Long-Term Holders Exit

Solana’s price rose 2.9% over the past 24 hours and broke above an inverse head-and-shoulders neckline on the 12-hour chart, a breakout that typically signals a trend reversal and offers more than 50% upside potential. Yet the move comes as long-term holders aggressively cut positions and leverage builds, creating a classic bull-trap risk if momentum fails.

The breakout pushed Solana above its 20-period exponential moving average, but a prior break above that same EMA earlier in February failed and led to a nearly 12% drop. A hidden bearish divergence formed between Feb. 2 and Feb. 21, with the price making a lower high while the Relative Strength Index made a higher high.

That divergence remains unless Solana breaks above $85.70, and broader risk persists until stronger resistance levels are cleared. Derivative data shows open interest rose from $1.96 billion on Feb. 20 to $2.08 billion on Feb. 21, a 6.1% increase, while funding rates flipped positive to 0.0016%, indicating new leveraged longs are entering.

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