Solana has been performing worse these days following increasing selling pressure. The recent hack worth $1.5 billion in the Bybit exchange has strengthened the resistance levels. The recent drop in price has been also triggered by low network activities. Several on-chain metrics have now declined, suggesting that SOL price might be preparing for more pain in breaking through resistance levels.
Solana’s Address Count Drops Steeply
The price of Solana had already been under pressure due to the aftermath of the Libra meme coin scam, and it faced further challenges following a $1.5 billion theft from the Bybit exchange. According to Coinglass, Solana’s total liquidations approached $17 million, with buyers and sellers liquidating approximately $14.3 million and $2.7 million worth of positions, respectively.
Despite these challenges, SOL’s price has seen some positive momentum due to excitement around exchange-traded funds (ETFs). Recently, Franklin Templeton took a significant step by filing for a new ETF that aims to track Solana’s spot price, signaling a rising interest in SOL.
Despite the positive developments, Solana’s on-chain metrics have been deteriorating. According to data from The Block, the number of transactions on the SOL network decreased from a high of 291 million to 273 million. Furthermore, there has been a significant decline in active addresses, with the count falling from a peak of 5.7 million to just 3.49 million.
Also read: Will Solana Reclaim $180 Before the Month-End? Here’s What’s Next for SOL Price Rally
This downward trend in key on-chain metrics suggests increasing bearish control for Solana. As network activity weakens, the volatility rate for initiating an upward rally diminishes.
Additionally, the SOL price might initiate further bearish rally as the short positions are increasing. Data from Coinglass shows that the long/short ratio has dropped to 0.8993. It suggests that currently 53% of total trades are in short.
What’s Next for SOL Price?
The crypto market is recovering, resulting in a strong correction in the SOL price following Bybit hack. Buyers are now pushing the price above immediate Fib levels to continue the upward momentum. As of writing, SOL price trades at $173, surging over 2.8% in the last 24 hours.
The SOL/USDT trading pair continues to struggle below $180, indicating strong domination from the bears. This price level could be a major obstacle as STHs might continue to liquidate here. However, buyers might soon break above that level if demand surges.
If the price falls below the EMA20 trend line on the 1-hour chart, the sellers will likely try to push it back down to $160 support level.
However, with the RSI level continuing to trade around the midline at level 48, it might trigger a retest of the resistance channel. If the price manages to hold above $180, it would favor the buyers. The trading pair could then increase to $220.
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