Summary
The price of Solana decreased by 1.35% over 24 hours, reflecting geopolitical tensions, a decline in meme coin activity, and technical weakness in the cautious cryptocurrency market.
Geopolitical uncertainty led to widespread selling in the cryptocurrency market.
The decline in meme coin activity (-15% in major tokens) reduced network fee revenues.
Technical breakdown below the support point at $146 with bearish momentum.
Detailed Analysis
1. Market Dynamics
The Fear and Greed Index in the cryptocurrency market dropped to 48 (Neutral) compared to 61 (Greed) last week, amid rising tensions between the U.S. and Iran. Bitcoin's dominance rose to 64.07% (+0.1% over 24 hours), indicating a shift of capital towards assets perceived as safer. SOL's performance was weaker than ETH, declining by 1.35% compared to 0.9% for ETH, reflecting specific pressures on altcoins.
2. Supporting Factors
Meme Coins Decline: Meme coins built on Solana, such as BONK and WIF, fell by 15% weekly (CoinGecko), reducing transaction fees which accounted for 75% of Solana's revenues in Q1.
Institutional Flows: SOL experienced a net outflow of $21 million from cryptocurrency funds compared to inflows of $402 million for ETH (Artemis).
Derivatives Pressure: Open interest rose by 1.2% to $1.8 billion despite the price decline, indicating the potential for holding leveraged long positions.
3. Technical Context
Major Breakdown: The price fell below the 10-day exponential moving average ($151) and the key support level at $146.49.
Momentum change: The MACD indicator turned negative (-0.89) with the Relative Strength Index (RSI) at 41.27, indicating the potential for continued decline.
Critical Support: The level of $141.44, the lowest price recorded on June 5, and breaking it could push the price towards $130.
Summary
SOL faces triple pressure from risk aversion at the macro level, declining momentum from retail investors, and a bearish technical structure. Although the network fundamentals are strong (representing 34% of the volume of all stablecoins), short-term sentiment is tied to the trend of meme coins and Bitcoin's movement.
Watchpoints: Will SOL be able to maintain support at $141? Will the integration of USDC via Upbit (on June 20) boost network activity?$SOL