Solana Price Extends Bearish Reach as On-Chain Volume Drops 30%

As a seasoned analyst with over two decades of market experience under my belt, I can confidently say that the current state of Solana’s price is reminiscent of a roller coaster ride with more downhill than upward momentum. The double-digit percentage losses in the past 24 hours are a stark reminder of the volatility that characterizes the crypto market.

In the recent market turmoil, the price of Solana experienced significant declines, with over 10% drop in the past day. The anxiety in the market has pushed bullish investors away and caused many to halt their activities, as suggested by the decrease in on-chain volume on the Solana network. The chart for Solana suggests that further losses may be imminent, as the asset has fallen below a critical support point.

Solana Price On the Edge

In the past day, I’ve noticed a significant dip in the value of my Solana holdings, down by approximately 12.6%, reaching $122.82 during the London trading session. This drop seems to mirror the widespread unease that’s been sweeping through the broader crypto market.

Currently, the price of SOL is experiencing a drop. The graph depicts a descending triangle that initially seemed to break through its resistance (a misleading spike), followed by a steep fall. The latest candlestick formation shows a powerful bearish trend, with a large red candle, implying persistent downward pressure.

Currently, the 50-day Exponential Moving Average (EMA) stands at approximately $157.14, while the 200-day EMA is around $138.86. Notably, both these values are higher than the current price, suggesting a bearish trend in the market.

The light gray area emphasizes that the SOL price temporarily found support at $100 and a more substantial support level between $60 and $80. If the price trend breaches these thresholds, Solana might fall to approximately $52. The chart for Solana also indicates potential resistance at $138.86 (200-day moving average) and later at $157.14 (50-day moving average).

The RSI value stands at 29.43, which means the price is currently too low, or oversold. This could cause a brief price increase, known as a bounce. However, the bigger trend continues to show a downward direction, suggesting bearish conditions. Additionally, the Chaikin Money Flow is at -0.10 and moving down, indicating that money is being withdrawn from the asset and adding to the selling pressure. This reinforces the negative outlook for this asset.

At 12.082 M, the volume level is unusually high, signaling intense selling activity and substantiating the ongoing downtrend.

If the price surpasses both the 50 and 200 Moving Average lines, it could challenge the bearish prediction, potentially leading the way towards $188 and $210. Nevertheless, such a situation seems improbable at this moment.

SOL On-chain Metrics Signal More Drop Ahead

The drop in Solana price is further confirmed by on-chain metrics, which track what is happening on the network in real-time. Data from Solscan shows that on-chain volume, which is the total amount of SOL transferred on the network, is dropping.

The decline in SOL‘s price suggests a decrease in both its demand and utilization, indicating a potentially negative trend, or a ‘bearish’ sign. Furthermore, this decrease in trading volume has had an impact on the overall value tied up within the network, resulting in a corresponding reduction.

Over the past week, the number of active addresses on the network decreased significantly, going from approximately 1,350,045 to 1,264,296. Simultaneously, the value of Bitcoin plummeted by around 27%, falling from $70,000 to its current price of $50,122.

A decrease in the number of active wallets, along with less network activity and decreased investor enthusiasm, suggests that the price prediction for Solana may be heading downwards, indicating a bear market.

2024-08-05 12:36

Solana Price On the Edge

SOL On-chain Metrics Signal More Drop Ahead

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