During the past few weeks Solana (SOL) experienced much selling pressure which forced its price to fluctuate between $140 and $150. And now, there is fear that it may even fall below the $140 support level. Currently ranked number 5 by market capitalization, SOL/USDT is trading at $141.34 at the time of writing. The odds for a bullish phase is against the altcoin after losing by 1.0% within the last 24 hours and by 20.9% within the last 30 days. Both the 24 hour chart and the 7 day chart are showing bearish disposition.
Solana Price Performance – CoinGecko
In the above image, you can see the 24 hour and weekly Solana price charts which are both showing bearishness. Despite the above current SOL price action the crypto asset was bullish in the past weeks despite failing to break above the $150 level. The shocking thing is during that period SOL’s network activity grew including deposits.
SOL Price Action Analysis: Why SOL Fails to Breach $150
There are several reasons why SOL has failed to breach the $150 price level despite the recent hype surrounding Pump.fun. In fact, some market observers contend that the recent SOL bullish push was due to Pump.fun activity and some meme coin airdrops. The current sluggish SOL price is, thus, due to the fall in Solana based meme coin activity. For example, over the past 30 days DogWifHat lost by 38%, BONK by 39%, Lido (43%), POPCAT (48%), and Wormhole by 31%. Notably, the trading volume on Pump.fun dropped by 33% during last week.
However, there was some positive development on the network as well. For example, there was a rise in activity on Jito liquid, the staking application as well as on Raydium, the Solana-based decentralized exchange. Kamino, the lending and liquidity platform, Jupiter, a decentralized exchange and Marinade staking solution performed exceptionally well during that period. The sad thing, though, is that the overall decline in activity on the Solana network affected various sectors that include Web3 infrastructure, gaming DeFi, gambling, NFT marketplaces and collectibles.
Uncertainty Surrounds the Approval of Solana ETF in the United States
The Solana market might have been dampened by the rumours that the United States SEC might be unwilling to approve the proposed spot Solana ETFs. The regulator stands by its word that Solana is a crypto security rather than a commodity. To worsen the situation the Chicago Board Options Exchange (CBOE) withdrew the 19b-4 filings for Solana spot ETFs from asset managers 21Shares and VanEck.
Solana Price Prediction
As hinted in the beginning, for the past few weeks Solana has been fluctuating between $140 and $150. Several times it failed to break above the $150 resistance level. As a result, it is fluctuating closer to the $140 support level. It is important to keep watching the direction that it will take in the coming days. Of course, investors should watch how the entire crypto market is behaving. Currently, many crypto assets are correlating with each other. However, not all of them have correlation. Usually, meme coins behave differently from the rest of the altcoins.
If SOL breaks below the $140 support level it may drop further down towards $130. If its price bounces off the $140 price level, it may shoot past $150. From there, it may probably push towards $160 or $170 for the best. However, several technical indicators show that SOL may maintain a bearish outlook for more days. Currently, the SOL relative strength index’s reading is 45 which is a bearish signal. On the daily chart most exponential moving averages that include EMA 3, EMA 5, EMA 10, EMA 21, EMA 50 and EMA 100 are all showing bearish momentum. However, the weekly higher EMAs such as EMA 50, EMA 100 and EMA 200 are bullish.
Solana’s closest support levels are $ 140.19, $ 137.72 and $ 133.46. These are the levels the bulls should guard to prevent a further price fall. On the other hand, its nearest key resistance levels are $ 146.92, $ 151.18 and $ 153.65. If the price surges above these three levels it may be on its way towards $160. It is important to note that SOL is positively correlated with all the top 10 cryptocurrencies except Tether USDT. In addition, it’s positively correlated with all the top 100 crypto assets except all the stablecoins.
Conclusion
It is essential to realize that before investing in cryptocurrencies one should do a thorough research to avoid making losses. However, even if you have made much research losses may occur due to much price volatility. As a result, one should invest only the amount that would not make him/her emotionally or financially strained if he/she loses it.
