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Solana (SOL) Price Could Fall by Another 60% After NFT Projects Abandon It

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In Brief

  • Solana broke down from the $30 resistance area.
  • Technical indicators are bearish.
  • There is horizontal support at $4.
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The Solana (SOL) price could resume its freefall toward $4 due to bearish indicator readings and negative Solana news.

SOL is the native token of the Solana blockchain platform. Solana is unique because it uses both a proof-of-history (PoH) consensus and combines it with the more well-known proof-of-stake (PoS) consensus mechanism. The platform was founded by Anatoly Yakovenko and specializes in smart contracts.

There was conflicting Solana news last week. On Dec. 23, Delphi Digital announced that Solana was now the number two ecosystem for NFTs, trailing only Ethereum. Measuring the 30-day sales volume, Solana left behind Cardano, Polygon, and BNB chain.

However, three days later, negative Solana news hit. DeGods and y00ts, two of the most significant NFT projects in the Solana ecosystem announced that they are migrating to Ethereum and Polygon, respectively. Once this occurs, it is possible that Solana will fall outside of the top 10 sales volume entirely. While there are rumors that both projects asked the Solana foundation for money in order to remain on the blockchain, this has yet to be confirmed.

Solana Price is Not Done Falling

The Solana price has decreased since its all-time high of $259.90 in Nov. 2021. Between May – Nov. 2022, the SOL price bounced at the $29 horizontal support area. However, it broke down on Nov. 14 amidst a massive bearish engulfing candlestick. The SOL price reached a low of $10.94 before the end of the month.

Even though the decrease since the breakdown has been substantial, the most likely SOL price forecast is the continuation of the downward movement toward $4. The two main reasons for this are:

Solana Price Long-Term Resistance
SOL/USDT Weekly Chart. Source: TradingView

The readings from the daily time frame align with those from the weekly one. Firstly, the SOL token price broke down from the $13 horizontal area. This comes after previously twice validating the area as support (green icon).

Next, the daily RSI has broken down from its bullish divergence trendline, which preceded the previous relief rally. As a result, the short-term rally has likely, and the long-term downward movement will now continue over the next 24 hours and beyond.

SOL Price Short-Term
SOL/USDT Six-Hour Chart. Source: TradingView

To conclude, the most likely Solana price forecast is bearish, supporting a drop toward the $4 horizontal support area.

Additionally, negative Solana news relating to the desertion of two of the biggest NFT projects in the Solana ecosystem could hasten the fall.

For BeInCrypto’s latest crypto market analysis, click here.

Top crypto projects in the US | June 2024

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Disclaimer

In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and ConditionsPrivacy Policy, and Disclaimers have been updated.

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Valdrin Tahiri
Valdrin discovered cryptocurrencies while he was getting his MSc in Financial Markets from the Barcelona School of Economics. Shortly after graduating, he began writing for several different cryptocurrency related websites as a freelancer before eventually taking on the role of BeInCrypto's Senior Analyst. (I do not have a discord and will not contact you first there. Beware of scammers)
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