The value of Solana in the crypto market has dropped by almost 6% to $138, even as Meme Coins enjoy a recent rise in their valuation.
In the past 24 hours, Solana (SOL) has experienced a substantial decline in value even though the ecosystem has experienced a surge in activity due to meme currencies. The market capitalization of the digital asset plummeted by nearly 6%, reaching as low as $63.83 billion.
The popularity of meme coins is on the rise
This week, the open interest in meme coins such as Book of Meme (BOME) increased to 10%, following a four-month low. Mog Coin (MOG), an additional meme coin, also experienced a surge of over 20% on Thursday.
Additionally, the token experienced an increase in trading activity. MOG’s trading volume was nearly $36 million on July 11, representing a 15% increase from the previous day. An additional meme coin, WATER, experienced a 350% increase in value in a single day following the promotion of the token on Instagram by the renowned footballer Lionel Messi and BOME and MOG. Within two hours of the Instagram post, the price of WATER increased from $0.00032 to $0.00146.
Nevertheless, the Solana ecosystem has experienced a surge in meme currencies, but SOL has underperformed this week, as the digital asset has continued to decline in tandem with Bitcoin (BTC) and Ethereum (ETH).
SOL’s value plummeted from $141 to roughly $138 earlier this week. Less than 24 hours after the bears appeared to have lost control of the coin, the bulls experienced an increase in momentum.
During this period, SOL rebounded above the 20-day EMA, which was labeled at $141. The SOL is expected to encounter significant seller resistance when it reaches the 50-day SMA ($151), as reports indicate. The bears are likely to aim for a decline to $116 if the price retreats from this level.
Market Sentiment and Future Prospects for Solana (SOL)
Nevertheless, the price would suggest a strong demand for higher price points if it breaks and closes above the 50-day SMA. The digital asset may advance toward the downtrend line in this scenario. Purchasers must prod the price beyond this downtrend line to invalidate the descending triangle pattern.
In the interim, the market sentiment regarding SOL remains inconsistent. The overall bearish trend in SOL’s price indicates broader market challenges despite increasing meme coin activity within its ecosystem, indicating a flourishing community and increased user engagement.
Investors are closely monitoring the regulatory landscape and macroeconomic factors that could impact the trajectory of digital assets such as SOL.
