Over the past few weeks, the crypto sector has been experiencing strong bearish pressure. From Bitcoin onwards, altcoins have suffered significant price declines. Among those that have suffered the worst is Solana (SOL), whose price has experienced a significant drop.
As CoinMarketCap data shows, in just over a week, the market cap of this token lost $10 billion. The result of this is a poor performance of -16.18% in the last week.
Could Solana’s SOL Token Lose $120 Support?
The fact that the fifth largest coin by market cap is losing $10 billion is particularly striking. This shows that investor confidence in the token is very low, especially in the immediate term. The case of this network and its native coin is complex.
For example, in 2024, it will experience tremendous growth as a result of the rise of memecoins. These speculative tokens were precisely the ones that helped SOL rise the most, but they can also be considered key elements in the crash. The drop in interest in Solana’s meme sector causes a decline in demand for SOL.
But this would not be the only factor that caused the current sell-off. In fact, it could be said that the crash is related to a sum of unconnected factors, which came together at the exact moment to lead to the crash. Macroeconomic elements, speculation with cash ETF applications in the United States and general pessimism in the crypto sector could be added to that list.
The truth of the matter is that the price of Solana (SOL) continues to fall. According to Finbold’s technical analysis, if it does not stay above $130, there are latent possibilities of losing the support of $120.
Solana price drops 16% in a week. Source: CoinMarketCap
Bearish force is intense, experts say
For crypto analysts, the current collapse of Solana’s native currency is a never-ending process. Simply put, the price will continue to lose value in the coming months. This is what analyst Scient believes.
In a post on social media platform X, the expert claims that SOL’s price is firmly tied to a “bearish pennant.” This would lead to a new bearish breakout in approximately 4-6 weeks after the current period of price consolidation.
$SUN IS IN THIS MASSIVE 6-MONTH-LONG BEAR PENNANT.
— One of the cleanest HTF bear pennants I have ever seen.
+-4/6weeks, the next downtrend leg will summarize. pic.twitter.com/3P5wbDVtX1
— Scient (@Crypto_Scient) August 31, 2024
As you can see, the reviews are not entirely positive for this coin. However, one should not lose sight of the capacity of the Solana network, as well as its utility. This Blockchain is one of the most important in the entire crypto world and several markets such as NFT and meme rely on its qualities such as security and scalability.
Other similar networks such as Avalanche also show a similar position. In fact, the AVAX token is also down in a week by approximately the same proportion as SOL. Consequently, Solana’s current drop could have common market roots and would not represent any particular problems. If this is the case, the current price could be marked as a buying opportunity.
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