Solana price has moved into a technical bear market as the crypto sell-off intensifies after the hawkish Federal Reserve decision.
Solana (SOL), the fifth-biggest cryptocurrency, dropped to the psychologically important support at $200.
Technicals point to a Solana price comeback
The daily chart shows that SOL price has formed a few bullish chart patterns, pointing to a rebound in the next few days. First, the coin is forming a falling wedge chart pattern, which is made up of two falling and converging trendlines. In most periods, this pattern leads to a strong bullish breakout when the two lines near their confluence level.
Second, Solana price has formed a break and retest pattern by moving to the support at $203. A break and retest is a situation where an asset rises above a key resistance and then retests it. It is a popular sign of a continuation. In this case, $203 was a notable level since it was near the highest level in March this year. It was also along the inverse head and shoulders pattern.
Third, Solana remains above the 100-day and 200-day Exponential Moving Averages and the major support and resistance level of the Murrey Math Lines. Therefore, there is a likelihood that the SOL coin will bounce back and enter beast mode soon. If this happens, the initial point to watch will be at $263, its highest swing last month. A break above that level will point to more gains to $300.
SOL has strong fundamentals
Solana price has strong fundamentals too. The network has become a big threat to Ethereum (ETH) by attracting developers and users. According to TokenTerminal, Solana had over 5.1 million users in the last 24 hours, much higher than Ethereum’s 441,000 and Tron’s 2.4 million.
Solana has also generated substantial fees this year. It has made over $700 million in fees this year as its ecosystem has boomed. Solana’s fees are much lower than Ethereum’s $2.42 billion because it is known for having much lower fees.
Additionally, Solana has become a dominant player in the meme coin industry, where its ecosystem tokens have accumulated a market cap of over $20 billion. It also has a big share in the Decentralized Public Infrastructure industry through platforms like Helium (HNT) and Hivemapper.
Most importantly, there are rising hopes that the next Securities and Exchange Commission will approve a spot Solana ETF. Gary Gensler’s SEC rejected such an ETF because it viewed SOL as a security. Paul Atkins may decide to approve mainstream coins.