The Solana price has experienced a significant decline of 15% over the last week, prompting concerns about its potential to rebound or succumb to further losses. As the cryptocurrency approaches a critical support level, investors and analysts are closely watching its movements to determine the likelihood of a bullish intervention or a deeper decline.
According to recent data, Solana (SOL) was trading at $193, down 5.3% in the last 24 hours and 15.2% in the last 7 days. This slump can be attributed to the growing investor caution and risk-off sentiment that has gripped the market, largely due to macroeconomic concerns such as the new wave of U.S. tariffs on Chinese imports.
Market Sentiment and Outlook
Despite the current downturn, market sentiment appears to be improving, shifting from extreme fear to fear following the Fed Chair’s recent dovish comments. These comments hinted at the possibility of two more rate cuts this year, which could have a positive impact on cryptocurrencies. However, traders remain hesitant, awaiting signs of progress in the upcoming US-China talks ahead of the November 1 tariff deadline.
A positive development in these talks could be crucial in reviving bullish momentum across the crypto market, including Solana, as the fourth quarter approaches. Historically, the fourth quarter has been the most bullish quarter for crypto assets, offering a glimmer of hope for investors.
Technical Analysis and Support Levels
On the daily chart, Solana is retesting the $190 support zone, a level that has repeatedly acted as a floor for the token since late August. However, technical indicators appear to be favoring a bearish setup, with the 20-day moving average falling below the 50-day moving average. This classic signal of a bearish reversal could lead to further losses in the short term if Solana fails to hold above $190.
Solana price tests $190 support – Source: crypto.news
If SOL fails to hold above $190, it could slide further towards $170, a level that marked last week’s low. On the other hand, a clear breakout above $211 would flip the script and likely invalidate the bearish outlook, offering a more optimistic view for investors.
Network Performance and ETF Hype
The Solana network has demonstrated resilience despite the overall market slowdown, recording an impressive DeFi trading volume of $6.16 billion in the last 24 hours. This surpasses competitors such as Ethereum and BNB Chain, confirming that activity on the network remains vibrant and users remain engaged despite the general market hesitancy.
Furthermore, investors are excited about the potential launch of the first spot ETF for Solana. Asset manager 21Shares has filed a Form 8-A with the U.S. Securities and Exchange Commission, signaling the final regulatory green light required for its Solana exchange-traded fund to go live. Once approved, it could pave the way for a wave of fresh capital from traditional investors, potentially providing the token with long-term upside potential.
As the broader market regains its footing, Solana could find the breathing space it needs to regain momentum in the final stretch of the year. For now, investors are watching closely, awaiting the outcome of the US-China talks and the potential impact of the Solana ETF on the market.
For more information and the latest updates on Solana and other cryptocurrencies, visit https://crypto.news/solana-price-nears-critical-support-will-it-drop-to-170/
