Solana (SOL) Price Dips 8% as Ethereum ETFs Take Center Stage

Solana Price Analysis

Solana price has decoupled from the broader crypto market trends in the past week, dropping 8% as it fell towards $175 on July 24. Market analysis and technical indicators explore the key bearish catalysts and how SOL could move as the month draws to a close.

Solana Crashes 8% Amid Market Rally

Solana is a layer-1 Proof-of-Stake (POS) blockchain protocol, with its fast transactions speeds enabling the development of DeFi protocols, payments channels and more recently, meme-coins.

The SOL ecosystem has emerged as one of the breakout crypto sectors this year, thanks to dominant themes surrounding meme-coins and rising popularity of its native Dexes like Jupiter (JUP).

In 2024 so far, Solana has recorded remarkable gains in excess of 82%, as it recorded a monthly timeframe peak of $185 on July 21.

This has seen Solana maintain its place within the to become the top 10 ranked cryptocurrencies by market capitalization, as per CoinMarketCap data. However, as the Ethereum ETFs launch drew closer, Solana has struggled to gain traction in the past week.

On July 21, Solana price rose to $185. But at the time of writing on July 24, SOL price has slid below the $175 mark, reflecting an 8% decline over the last 3 days of trading.

In comparison, Ethereum and Bitcoin have recorded gains in excess of 5% during that period, while the broad altcoin market cap also grew by a similar margin.

Hence, Solana price declining 8% during a market rally, raises alarms among short-term bull traders. Currently, the dominant speculative narrative is that crypto investors have shifted focus away from the Solana ecosystem, following the announcement of the Ethereum ETFs’ impending launch.

The demand for SOL could decline further in the days ahead, raising the risk of further downside, with investors channeling capital towards Ethereum-hosted projects to benefit from the expected ETF inflows.

SOL Price Forecast: $170 Support at Risk?

Solana price has shown a robust performance in recent weeks, rallying to monthly peak of $185 as of July 21, 2024. However, the current technical indicators suggest potential volatility ahead, with a possible breakdown below the critical $170 support level.

The price chart reveals that Solana has faced resistance around the $177 mark, leading to a slight pullback. The 8.04% decline over the past three days indicates selling pressure that could push the price lower.

The immediate support levels to watch are at $160.22 and $153.71, marked by the 20-day and 50-day exponential moving averages (EMA) respectively. These levels are crucial for maintaining the current bullish momentum.

The Chande Momentum Oscillator (ChandeMO) is currently at 34.88, indicating a decrease in buying momentum.

This could suggest that the recent uptrend may be losing steam, raising the possibility of further downside movement. If the price falls below the $160 support, the next significant support level is around the 100-day EMA at $150.52. A breach of this level could confirm a bearish trend, with potential targets at the 200-day EMA around $135.56.

Conversely, if Solana can hold above the $170 support and regain upward momentum, key resistance levels are at $180 and the psychological barrier at $200. Breaking above these resistance levels would signal renewed bullish strength, possibly driving the price higher.