Despite setbacks, bear markets, and other factors, Solana has maintained its position among the top-performing cryptocurrencies. However, its recent downtrend concerns investors, as the Solana (SOL) price has declined nearly 50% from its 2024 high of $264. More importantly, the price has dropped 15% over the week and 40% over the month, which is concerning. Although this altcoin’s decline came with the broader market’s crash, investor sentiments have triggered fear, so what’s next?
Solana Sentiments Turn Bearish Despite Price Recovery
After a 40% crash over the month and hitting a four-month low of $134.69, the Solana price has gained a minor recovery. At present, it trades at $142.39 after a 1.5% recovery in the last 24 hours. However, investor sentiments turned bearish amid building fear.
According to the crypto analyst Ali Martinez’s conclusion, the Glassnode Net Unrealized Profit/ Loss metric reveals that the SOL investors have entered the fearful phase after spending months in greedy or optimistic sentiments. This drop is also visible in the token trading volume, which is down 18% to $13 billion.
Many crypto analysts have confirmed this bearish trend, one saying:
You can dip in briefly and come out with a tasty 1-2% profit at this $Solana price. If that line breaks, it’s heading to $80.
Why Did Solana Price Drop in the First Place?
The broader crypto market crash has severely impacted the SOL token’s price performance. However, many other factors influenced this, beginning with the LIBRA or Solana meme coin scam.
Since the introduction of Pump.Fun, the number of Solana-themed meme coins has increased multiplefold. In addition, the intensity of pump-and-dump scams rose, and the LIBRA token scam is the most prominent example.
This resulted in the Solana meme-themed cryptocurrencies’ market cap declining from $25 billion in January to $8.6 billion. Other factors like the drop in gas fees, DEX volume, and active address count drop show investors’ confidence has plummeted in this ecosystem.
Interestingly, another significant factor to consider is the 11.2M SOL token unlocks on March 1, which created selling pressure. These unlocks would provide additional liquidity and come from the FTX distribution plan.
As a result, the SOL price mat fluctuates; some believe in a possible recovery, while others believe in further consolidation.
What’s Coming Next For SOL?
Many crypto analysts confirm this bearish trend, with Ansem stating:
The $120-$140 range is a must-hold area. Shorting after a 50% drop in a month is not a good trade, but overall, I remain bearish on most crypto assets in the high timeframe.
Although the outlook is bearish, there are also indications of a possible recovery. The analysts’ Solana price prediction reveals that the token must hold the $120-$140 support for recovery. If this happens, the SOL price may rebound towards the $170 resistance.
However, if Solana breaks below $120, it could test psychological support at $100.
Bottom Line
The investors are fearful amid Solana price struggles and the global crypto market crash. With the key support between $120 and $140, the token can either move toward $170 or $100, depending on its move from the current level.
However, these moves will depend on market sentiments, ecosystem recovery, and the impact of the upcoming unlocks. Investors must analyze the SOL price further and plan strategically.
The post Solana (SOL) Investors Fearful after Price Crashes 40%, What’s Next? appeared first on CoinGape.
