Solana price has entered a bear market after falling more than 35% from its September high, and an impending death cross points to more downside despite rising ETF inflows.
Summary
- The Solana price has fallen by more than 35% from its September high.
- It is about to form a death cross pattern on the daily chart.
- The coin has also formed an inverted cup-and-handle pattern.
The Solana (SOL) token was trading at $160, a range it has remained at for the past few days. This is fluctuating at the lowest level since August this year.
Data from SoSoValue shows that demand for Solana is increasing among US investors. These funds had inflows of $12.6 million on Friday, bringing the cumulative total to $337 million.
They now own $575 million in assets, while Bitwise’s BSOL has $478 million in assets. Grayscale’s GSOL has amassed $97 million in assets. Their combined assets equal 0.64% of the market capitalization. This influx may continue after Grayscale waives its fees.
Solana’s price has fallen despite rising inflows due to broader weakness in the crypto industry. Bitcoin (BTC) and most altcoins have remained tense in recent weeks amid concerns about the Federal Reserve’s next actions.
Another possible reason is that Solana does not belong in the core themes that are doing well. For example, it is not considered an artificial intelligence or a privacy token.
Top privacy tokens such as Zcash, Dash and Monero, and AI tokens such as Near, Filecoin and FET have led the gains in the crypto market.
Still, Solana has some solid fundamentals that could help the company recover later this year. ETF inflows are rising and the Alpenglow upgrade is underway. Finally, Alpenglow will introduce a sub-second, an increase in throughput, cost savings on the validator, and a new consensus mechanism.
Solana price technicals point to more weakness
Technical figures suggest that SOL price will remain under pressure before eventually recovering. It is about to form a death cross pattern, which happens when the 50-day and 200-day moving averages start to cross. A death cross is one of the riskiest patterns in technical analysis.
The coin also forms the handle portion of the reverse bowl-and-handle pattern. Moreover, it has formed a bearish pennant and remains below the Supertrend indicator.
Therefore, the most likely scenario is that the Solana token continues to decline as traders target the key support at $126, the June low. This price is approximately 20% below current levels.
Disclosure: This article does not represent investment advice. The content and materials on this page are for educational purposes only.
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