Activity surged on the Solana network, yet SOL’s price recorded a drop. Why?
- Activity on the Solana network grew, however, SOL’s price declined SOL’s popularity waned, but sentiment remained positive
Solana’s [SOL] ecosystem has grown consistently over the last few months due to the network’s increasing popularity. In fact, due to this surge in interest, the number of transactions happening on the Solana network has grown significantly too.
Good times for network activity
According to some analyses, such has been the recent dominance of the Solana network, that it has outperformed all other networks on this front.
Source: X
Despite the aforementioned surge in activity, however, the price of SOL declined by 3.13% over the last 7 days. This suggested that Solana ecosystem’s performance and SOL’s price may be losing their correlation with each other.
This isn’t the first time something like this has happened either. For instance – On 11 April, there was a massive surge in transactions on the Solana network. However, the price activity moved in a completely different direction and fell by 20%.
Source: Artemis
SOL’s value continued to move sideways for quite sometime, before registering a reversal in its trend. After 15 May, SOL’s price was met by a surge in bullish momentum, causing the price of SOL to surpass its previously established lower lows and lower highs. At press time, SOL was trading at $169.23.
Even though the recent correction in SOL’s price wasn’t significant enough to break the bearish trend, if the bearish pressure persists, it could lead to SOL hitting the $152.48-level.
At the time of writing, the RSI (Relative Strength Index) for SOL had fallen to 43.91, implying that bullish momentum around SOL waned significantly. The CMF (Chaikin Money Flow) for SOL also declined to -0.03 – A sign of low capital inflows.
Source: Trading View
Social volume takes a hit
A factor that could gravely influence the price of SOL in the future could be its popularity on social media. AMBCrypto’s analysis of Santiment’s data revealed that the social volume around SOL fell significantly over the last few days.
This indicated that the number of comments and replies on social media around Solana declined significantly. The waning popularity of SOL could affect its price movement adversely on the charts.
On the contrary, SOL’s weighted sentiment recorded an uptick, implying that the conversations that have been happening around SOL were positive in nature.
If the weighted sentiment remains positive while social volume hikes, SOL’s price movement might take a positive turn.
Source: Santiment
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