Solana Price Analysis: SOL Could Drop to $100 as It Struggles to Clear Key Resistance

This week, the Chairman of the Federal Reserve, Jerome Powell, said that inflation will likely increase as a result of President Trump’s aggressive tariff increases.

He emphasized that the central bank could face a dilemma as economic growth could slow down while inflation is going up.

Straightforward monetary policy decisions may not work in this scenario as lower interest rates would push inflation higher but would help economic activity while higher rates will depress the economy but will keep inflation in check.

Crypto assets have struggled to respond to this uncertainty as reflected by their weekly performance. For example, Bitcoin (BTC) and Ethereum (ETH) have delivered gains of 1.7% and 0.9% during this period.

Solana (SOL) has shined lately, propelled by higher trading activity in the meme coin space as tokens like Fartcoin (FART), Popcat (POP), and Bonk (BONK) have rallied.

Solana’s On-Chain Activity Has Dropped

Despite a recent drop, FART has still managed to produce 30-day gains of 128%, making it one of the best-performing assets in this category during this period.

However, is FART’s rally enough to push Solana higher?

On-chain data from DeFi Llama shows that Solana’s daily transaction volumes are still on a downtrend and have accumulated a 21% decline since the year started.

Weak network activity means lower demand for SOL and supports a bearish short-term outlook. This explains why the market has sold off most rallies as fundamentals are still weak.

Market sentiment has improved recently as President Trump backpedaled from his decision to impose high tariffs.

However, investors are still in fear as the implications of these measures are uncertain and will only be revealed in the next few days as negotiations with key commercial allies make progress – or not.

SOL Needs a Clean Break Above $150 to Keep Rallying

Looking at Solana’s daily chart, the price action recently broke a descending triangle and managed to climb above the 21-day exponential moving average (EMA), indicating that the trend’s direction could be changing.

Bullish breakouts above the 21D EMA have happened two times already in the past and they have not yielded the expected outcome and have turned out to be bull traps.

However, as this breakout occurred in a value area (high volumes), the odds that it may lead to a strong recovery for SOL are higher than usual.

Momentum indicators are also favoring a bullish outlook as the Relative Strength Index (RSI) jumped above its 14-day SMA, meaning that the uptrend has been gaining strength.

Similarly, the MACD’s histogram has been on an uptrend in the past 8 days as the price has been progressively climbing.

SOL has now hit a key resistance at $135. This price area has been its point of control (POC) throughout the year.

This means that the highest trading volumes have occurred in this range between $130 and $145. Hence, whatever happens next could provide a strong signal of where the market could be heading next.

What Solana needs at this point is a clean break above the $150 level as this would push the token to an area with much lower volumes where bulls will encounter little resistance to push the token much higher.

However, selling volumes have been strong at current levels. This increases the odds that the price could reject a move above the $135 area again.

A break below the 21D EMA would confirm a bearish outlook as this has been a strong signal in the past two instances that the bullish breakout was a false positive.

If that happens, it seems highly likely that SOL will retest the $100 level as this is the nearest area of support that has encountered strong buying volumes.