Solana (SOL): Assessing the Bottoming Pattern as a Strategic Entry Point in October 2025

On-Chain Momentum: A Tale of Two Metrics

Solana's on-chain metrics in October 2025 reveal a nuanced picture of growth and divergence. The network processed over 386 million transactions in the past week, maintaining its dominance as the most active blockchain ecosystem, according to a Blockchain.news report. Monthly active addresses surged to 123 million, a 42% increase from September, driven by memecoin trading platforms like Pump.fun and Raydium, according to The Block. However, daily active addresses dipped to 2.7 million in early October from 4.2 million in mid-August, despite SOL's price rising from $175 to $220 during the same period, per the Blockchain.news report. This divergence raises questions about the sustainability of the price rally, as speculative activity appears to outpace organic adoption.

Total Value Locked (TVL) in Solana's DeFi ecosystem reached $9.3 billion in Q1 2025, as CoinLaw data shows, but recent data shows a mixed trend. While decentralized exchange (DEX) volume hit $326 billion in Q3 2025, the Blockchain.news piece reported, daily transaction volume has declined by nearly 50% since July 2025, according to CoinLaw. Analysts attribute this to structural shifts in consensus mechanisms and reduced DeFi/NFT activity, though low fees ($0.00025 per transaction) and high throughput (65,000 TPS) continue to attract developers and traders, per CoinLaw.

Technical Analysis: Bullish Patterns Amid Volatility

Solana's price action in October 2025 suggests a potential bottoming pattern. The token trades near $220, supported by its 50-day SMA ($216.85) and 20-day SMA ($220.10), the Blockchain.news report noted. A classic "cup and handle" formation on the monthly chart implies a target of $425 if the pattern completes, according to an FXLeaders analysis, while shorter-term indicators like the RSI (53.85) and MACD (6.3023) signal bullish momentum, as observed by Blockchain.news. A breakout above $218.00 could trigger further gains toward $242, $254, and $262, the Blockchain.news coverage added.

However, caution is warranted. The Chaikin Money Flow (CMF) remains below zero, and declining new wallet addresses (down 15% in October) suggest weak liquidity, the Blockchain.news report warned. Solana is also within a rising wedge pattern, historically a precursor to bearish reversals if support levels fail, per CoinLaw. Immediate resistance lies at $241.82, with a breakdown below $210–$215 risking a pullback to $190.80, the Blockchain.news piece noted.

Market Sentiment: ETF Hype and Institutional Inflows

Market sentiment for Solana remains bullish, fueled by institutional adoption and regulatory developments. Weekly inflows into Solana-based ETFs and ETPs reached $705 million in October, doubling from the prior week, according to a BTCC report. This surge coincided with anticipation for U.S. ETF approvals, though a government shutdown delayed the SEC's decision, causing temporary price corrections, as FXLeaders noted. Analysts project that favorable ETF rulings could push SOL toward $250–$280 in the short term, The Block reports.

Social and whale activity also reinforce optimism. Over $200 million in SOL was moved from unknown wallets in October, signaling large-scale investor interest, the Blockchain.news piece reported. Meanwhile, Solana's DEX market share hit 27.7%, with Raydium and Pump.fun driving record token launches, The Block observed.

Strategic Entry Point: Balancing Risks and Rewards

For risk-aware investors, Solana's current setup presents a compelling but cautious case. The convergence of bullish technical patterns, institutional inflows, and strong DEX activity supports a near-term target of $240–$265. However, on-chain divergence and declining transaction volume highlight the need for disciplined risk management.

Historical backtests of the cup-and-handle pattern since 2022 show an average 30-day gain of +12% for SOL, roughly double the +6% benchmark return, according to the BTCC report. Out-performance typically peaks around day 8–10, though one event slipped into negative territory after day 20, underscoring the pattern's inherent risks, the BTCC analysis noted.

Key entry strategies:
1. Conservative Approach: Wait for a pullback to $230–$235, where the 20-day EMA and 50-day EMA converge, offering a favorable risk-reward ratio (BTCC).
2. Aggressive Approach: Buy above $244.14 with a stop-loss at $238, targeting $255–$265 if the wedge pattern breaks (BTCC).

Investors should monitor the $210–$215 support zone closely. A breakdown here would invalidate the bullish case, while a sustained move above $241.82 could catalyze a retest of the 2025 all-time high of $294.83, as FXLeaders suggested.

Conclusion

Solana's October 2025 price action reflects a delicate balance between speculative fervor and fundamental strength. While on-chain metrics like TVL and DEX volume underscore its role as a high-performance blockchain, divergences in daily activity and transaction volume caution against over-optimism. For investors willing to navigate short-term volatility, the current bottoming pattern-supported by institutional inflows and bullish technicals-presents a strategic entry point, provided key support levels hold. As the crypto market approaches year-end, Solana's ability to sustain its momentum will hinge on resolving the tension between price and on-chain adoption.