Solana (SOL) has gone down by 6% in the past week and although the token has recovered in the past 24 hours, technical indicators favor a bearish outlook.
Trading volumes have gone up by nearly 18% as bulls managed to reverse an early sell-off during the Asian session.
However, meme coins, an important segment of the Solana ecosystem, have been performing poorly recently.
Tokens like Pudgy Penguins (PENGU) and Popcat (POPCAT) have shed most of the gains they delivered last month as market sentiment has cooled off.
Rising tensions between the Trump administration and China on tariffs have spooked investors once again. As a result, the Fear and Greed Index has dropped from a local high of 76 (Greed) to 46 (Neutral to bearish) in less than 15 days.
Decentralized exchanges within the Solana ecosystem have experienced a decline in their trading volumes.
Data from DeFi Llama show a weekly drop of 12.7% across the top protocols like Orca, Meteora, PumpSwap, and Raydium.
Solana Price Prediction: SOL Has a Downside Potential of 36%
Looking at the daily chart, we can see two robust sell signals that favor a bearish Solana price prediction.
The first is a ‘death cross’ between the 9-day and 21-day exponential moving average (EMA) along with a similar bearish crossover between these two short-term EMAs and the 200-day EMA.
This indicates a change in the price trend and also implies that negative momentum is accelerating.
Moreover, the price action has experienced a change of character (ChOCh). This means that the previous uptrend has been reversed as the second-best higher high was broken. This is also bearish.
Moving forward, the price could scale back until it retests its latest dominant impulse at around $110. This means a 36% downside potential from where Solana is now. However, it does not necessarily mean that the token will get to that point.
Bulls could step up at any of the intermediate levels highlighted in blue and, if they manage to trigger another change of character, that would mean that end of the downtrend for the time being, at least in the daily chart.
The next key support level to watch would be the $135 level, at which point buyers’ strength will be put to the test.
Despite this temporary setback, the Solana ecosystem will continue to attract significant interest amid the network’s technical strengths.
Solaxy (SOLX), one of the hottest crypto presales of this year, will soon launch its layer-2 scaling solution for Solana and its utility token will likely explode after this happens.
Solaxy (SOLX) aims to eliminate the congestion issues that have affected the performance of the Solana blockchain during peak usage periods.
The project achieves this through a side chain that bundles transactions offline before sending them to the mainnet to alleviate its burden.
The developing team has successfully launched a testnet and a block explorer for the L2 that investors can use to check the real-time performance of this solution.
Once the Solaxy L2 is adopted by top wallets and exchanges, the demand for $SOLX will skyrocket.
Hence, early buyers who take advantage of its presale price will reap the highest returns. To buy $SOLX, head to the Solaxy website and connect your wallet (e.g. Best Wallet). You can either swap SOL or USDT for this token or use a bank card to invest.
Alejandro Ar
