Solana’s price fell for two consecutive days on Monday, hitting its lowest point since January 3, as risk sentiment spread across financial markets after Donald Trump threatened new tariffs on key NATO members.
Summary
- Solana price has formed a cup-and-handle pattern on the daily chart.
- The continued deterioration is part of the formation of the handle portion.
- Third-party data shows that Solana transactions are soaring.
The Solana (SOL) token retreated to a low of $130, down 10% from this year’s high. This pullback brought its market cap to $80 billion, making it the sixth largest cryptocurrency in the industry.
On the upside, Solana has strong technical and fundamentals that can help support the near-term recovery. For example, data from Nansen shows that it is the most actively used blockchain in the crypto industry.
It processed more than 1.86 billion transactions in the past 30 days, an increase of 1.8%. The transaction fees were much higher than other networks such as Ethereum, BNB Chain, Tron and Polygon combined.
Solana also had more than 72 million active addresses during this period, an increase of 18%. The active addresses were much higher than those of other popular chains.
Furthermore, Solana’s DEX volume has increased to over $114 billion in the past 30 days, much higher than that of Ethereum, Base, and BSC Chain combined. All these numbers led to an increase in network costs, which rose to $18.5 million.
Solana is also becoming a popular chain in areas other than meme coins. For example, it has become a major player in the tokenized stocks industry, increasing its total value to over $1.6 billion.
This growth is likely to accelerate after the network launches the Alpenglow upgrade later this quarter. This upgrade introduces new features and faster speeds.
Meanwhile, spot Solana ETFs have continued their inflows this year. They added more than $97 million in inflows in January, with total assets increasing to $1.2 billion.
Solana price technical analysis
The daily timeframe chart shows that the Solana token pulled back sharply after reaching the key resistance level at $146, which was a few points below the 23.6% Fibonacci Retracement level.
This pullback is likely part of the handle portion of the cup-and-handle pattern, a common bullish continuation pattern. The coin remains in the green, a sign that the rebound remains intact.
Therefore, the coin is likely to bounce back to the 50% Fibonacci Retracement level of $185, up 40% from current levels.
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