Solana Price Extends Bearish Reach as On-Chain Volume Drops 30%

Solana price was not left behind in the ongoing market onslaught, suffering double-digit percentage losses in the last 24 hours. The fear palpable in the market has sent bulls back into the shed, and investors have taken to the sidelines, as signaled by the dropping on-chain volume on the Solana network. Solana chart indicates more pain is due as the asset has broken below a crucial support level.

Solana Price On the Edge

The price of Solana dropped by 12.6% in the last 24 hours to $122.82 during the London trading session, reflecting the panic in the general crypto market.

SOL price is currently in a downward trend. The chart shows a descending triangle with a fake breakout (fake out) above the resistance, followed by a strong decline. The recent candlestick pattern indicates a strong bearish move with a large red candle, suggesting continued downward momentum.

The 50-day EMA is at $157.14, and the 200-day EMA is at $138.86. Both are above the current price, confirming the bearish trend. 

The grey band highlights the SOL price’s temporary support at $100 and a stronger support zone between $60 and $80. If the price action breaks both of these barriers, Solana may drop back $52. The Solana price chart also sports resistance at $138.86 (200-day EMA), followed by $157.14 (50-day EMA).

The Relative Strength Index (RSI) is at 29.43, indicating that the price is in oversold territory. This might lead to a short-term bounce, but the overall trend remains bearish. The Chaikin Money Flow (CMF) is at -0.10 and heading downward, indicating capital outflow from the asset and increasing selling pressure. This further supports the bearish outlook.

The volume is significantly high at 12.082 M, indicating strong selling pressure and confirming the downward move.

A break above the 50 and 200 EMA may invalidate the bearish thesis and set a course back to $188 and $210. However, that is unlikely currently.

SOL On-chain Metrics Signal More Drop Ahead

The drop in Solana price is further confirmed by on-chain metrics, which track what is happening on the network in real-time. Data from Solscan shows that on-chain volume, which is the total amount of SOL transferred on the network, is dropping. 

This drop means the demand and usage of SOL have decreased, which is a bearish signal. Additionally, the drop in volume has affected the total value locked in the network, causing it to drop.

Similarly, active addresses on the network dropped from 1,350,045 to 1,264,296 in the last seven days. During this same period, Bitcoin price crashed 27% from $70,000 to its current price of $50,122.

The drop in the number of active addresses, coupled with the reduction in network usage and interest, signals a bearish trend in the Solana price forecast.