Solana
Solana down 40% but analyst says now is the time to buy SOL — TradingView News
Solana, one of the top altcoins, behind Ethereum and the BNB chain, was not spared during the recent correction. After hitting $210 in Q1 2024, the coin is now sliding, facing strong headwinds, plunging and tracking the performance posted by Bitcoin and Ethereum.
Is now the best time to buy Solana?
Even amid this deep retracement, Raol Pal, a macro analyst, believes this is the best time for investors and traders to consider Solana. In an article on
NewsBTC
Looking at the SOLUSDT chart, it is clear that the coin is moving sideways and inside a larger flag following the peak to over $200 in March. However, what stands out from this downturn is that the area between $120 and $125 is support to watch.
At press time, SOL is changing hands at around $130, down around 40% from March 2024 highs. If the late May 2024 declines continue, it will be interesting to see how prices respond at this level. www.tradingview.com/x/ktPPoOMZ
From Pal’s perspective, the analyst expects prices to rebound from this level and resume last year’s uptrend. The problem is that there will be no guarantee that prices will increase from this support zone.
Technically, a close above $190, and preferably $190, could mark the resumption of the next bullish leg, crushing the bears.
On-chain activity declines as Ethereum prepares for more institutional support
It is not yet clear whether this will happen in the coming weeks or months. SOL’s performance is primarily linked to market developments and on-chain activity, among other factors.
Although Solana is quickly becoming a preferred choice for meme coin issuers, there has been a marked decline in on-chain activity in recent days. Notably, Ethereum layer 2 solutions such as Base, Arbitrum, and Optimism appear to be taking over.
Solana offers higher scalability than Ethereum, which means transaction fees are low. When on-chain activity decreases compared to other cheaper platforms, it could mean that demand for SOL is decreasing, which is a net negative for prices.
At the same time, the stock market recovery, which saw the rally of indices like the S&P 500, could focus investors’ attention on cryptocurrencies. Additionally, with the U.S. Securities and Exchange Commission (SEC) set to approve an Ethereum spot exchange-traded fund (ETF), more capital will flow into ETH.