Solana’s Key Support at $159 Might Yield
Chains and technical indicators confirmed Solana’s bearish momentum. The weekly chart of the SOL remains in the green zone, but the trend may be changing soon.
The price of Solana [SOL] was consolidating at the time of writing to form a pennant pattern after a significant rise over the past three months. Despite the bullish pattern, Solana was showing bearish momentum.
The price is building in a bearish move towards the resistance level which has become support at $159. If this support level is breached, the price could fall further to fill the fair value gap at around $153.
Solana [SOL] has been gaining a lot of traction in the recent past, due to several memecoins releases on the blockchain. There was more going on with blockchain, though, as a key metric was trending upward, which seemed quite optimistic.
Do Metrics Indicate Bearish Sentiment?
A media outlet analyzed Santiment’s social volume indicator and found a short-term volume spike and a predominantly downward volume trend. The metrics are consistent with the bearish momentum of the SOL price.
The long/short ratio of Coininglass was further analyzed, which indicated more short positions than long positions for Solana. This ratio indicates that investors are expecting the price to fall further, confirming the bearish pattern.
Tradingview’s MACD chart indicator indicated a bearish momentum in SOL that could break the support level of $159 and fall to $153.
The MACD line below the signal line indicates a bearish crossover with the large negative histogram bars confirming the downward momentum.
The Stochastic RSI (34.4) is out of range, but leaning towards the lower border, indicating a neutral to slightly oversold market.
Technical indicators and chain analysis aligned to indicate possible bearish momentum at the $153 price level.
The MACD shows bearish momentum, which is supported by the Stochastic RSI. However, if the price fails to break above the support level, a bullish move is likely.
Solana Is Growing
The media has previously reported how Solana’s volume has increased, which can be attributed to multiple memecoin launches such as Dogewifhat [WIF]BONK, etc.
In addition, the blockchain’s performance in the DeFi space was commendable. This was the case as Solana’s LTV recently reached an all-time high.
On top of that, a tweet was recently published by Token Terminal that highlighted yet another achievement of the company. According to the tweet, SOL rates are on the rise.
In fact, if the latest data is anything to go by, SOL’s rates were pretty close to Ethereum’s. [ETH]. AMBCrypto’s analysis of Artemis data revealed that a similar trend was also observed in terms of both blockchains’ revenues.
While Solana’s fees and revenues were close to Ethereum’s, SOL already dominated ETH by a significant margin in terms of network activity.
Both Solana’s daily active addresses and daily transactions were significantly higher than Ethereum’s, reflecting SOL’s popularity and high adoption.
However, Ethereum continued to lead the DeFi space as its LTV was much higher than SOL’s.
SOL Bulls Will Not Let Go
With the token’s weekly price action remaining positive in a slightly bearish market, SOL bulls rejected the decision to resign. According to CoinMarketCap at the time of writing, the token was trading at $167.45 with a market cap of over $76.9 billion.
Thanks to the bullish price action, Solana’s weighted sentiment remained high. This meant that the bullish sentiment around the token dominated the market. In addition, its social volume also remained high, reflecting its popularity in the crypto space.
By Audy Castaneda