Solana (SOL) has recently faced challenges in its price movement, with the altcoin showing signs of a potential downtrend.
Despite some initial gains earlier, broader market conditions, investor behavior, and lack of support at key resistance levels have caused SOL to struggle.
Solana Holders Step Away
Long-Term Holders (LTHs) of Solana are showing signs of selling, as seen in the Liveliness indicator spike. The Liveliness metric tracks the frequency of transactions from LTHs, with a spike indicating selling behavior. This recent uptick reflects that LTHs, who have held Solana for extended periods, are choosing to cash out to preserve their profits.
Given that the price continues to decline, these actions create downward pressure on the market. Selling from key investors is contributing to a bearish outlook for the altcoin, as it seems that investor confidence is wavering.
Solana’s overall momentum is influenced by the behavior of its Exponential Moving Averages (EMAs), which serve as key technical indicators for price direction. Currently, the 50-day (red) and 200-day (blue) EMAs are moving in parallel, a sign of indecision in the market. A previous attempt at a crossover between the 50-day and 200-day EMAs was unsuccessful.
The 50-day EMA was on track to cross above the 200-day EMA, signaling a potential Golden Cross, but the delay and subsequent price decline have extended this crossover. The failure to achieve this crucial signal could hinder Solana’s upward movement and contribute to the current bearish price trajectory.
SOL Price Decline To Continue
Currently, Solana is trading at $159, just under the $161 resistance level. The failed attempt to breach $165 this week has resulted in a three-week downtrend, which now appears to be building momentum.
Given the bearish market signals, Solana’s price could fall to $152 if the current downtrend continues. If SOL loses support at $152, the price may slip further to $144, worsening the overall market sentiment. The continuation of selling pressure will exacerbate this downward movement.
However, should the broader market conditions turn bullish, there is potential for Solana to recover. If SOL can breach the $161 resistance level and secure it as support, the altcoin could rise to $168, reversing the downtrend. This shift would indicate a bullish trend and signal the end of the current price struggles.
Disclaimer
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