The price of Solana experienced a significant decline over the course of two days as the ongoing sell-off in the cryptocurrency market affected its meme coin sector.
On Saturday, Solana (SOL) fell to $127, marking a 15% drop from its peak earlier in the week. This represents its lowest value since March 2021.
This downturn coincided with a plummet in many Solana meme coins, wiping out most of the gains accumulated earlier in the week. Fartcoin (FARTCOIN) fell by 15% on Saturday, while well-known tokens such as Popcat (POPCAT), ai16z (AI16Z), and Bonk (BONK) saw declines exceeding 10%.
The overall market capitalization of all Solana meme coins dropped by over 10%, now totaling $7.2 billion. This decline indicates that these tokens have lost more than $18 billion in value over the past few days.
Data from various sources reveals that cryptocurrency traders capitalized on the Solana meme coin rally at the beginning of the week.
Reports indicate that Solana’s decentralized exchange (DEX) volume surged by 60% in the last week, surpassing $3 billion. This figure outpaced Ethereum (ETH) and Binance Smart Chain (BSC), which recorded $11.35 billion and $8.9 billion, respectively. This marked the first occasion in weeks where Solana’s DEX protocols outperformed both competitors.
Much of Solana’s DEX volume was driven by Pump, which processed transactions worth over $2.8 billion, outperforming other major DEX networks like Orca, Meteora, Raydium, and Lifinity, which have traditionally commanded a larger market share.
In addition to these developments, Solana also received some positive news this week. One of the most significant updates was the expansion of BUIDL, managed by Blackrock, the world’s largest asset manager, to the network. This is noteworthy as BUIDL’s assets have ballooned to over $1.86 billion.
Technical Analysis of Solana Price
The daily chart indicates that Solana has suffered a steep decline in recent months, dropping from a high of $295.45 in January to its current level of $126. Recently, it has formed a bearish flag pattern, characterized by a tall vertical line and a rectangular shape.
Additionally, on March 4, Solana displayed a death cross pattern, where the 50-day and 200-day moving averages crossed each other while trending downward.
Hence, the combination of a death cross and a bearish flag suggests a potential strong breakdown, possibly leading to a decline to $100. For this scenario to unfold, Solana will need to fall below the support level at $120, which it has struggled to breach several times since April of last year.