- Solana ($SOL) plunges to its lowest level since November 2024, erasing the Trump election pump gains.
- Market analysts predict a potential further downside to $100, but PumpFun’s new AMM aims to counter the decline by increasing network usage.
- SOL’s RSI enters the oversold zone; key levels to watch include $160 support and $144 stop-loss.
Solana (SOL) has taken a hit, falling below $160 for the first time since November 2024. This price drop wipes out any gains it saw following the Trump election hype.
Technical Signals Hint at Potential Solana Rebound
From a technical viewpoint, Solana’s Relative Strength Index (RSI) has slipped into oversold territory. This often suggests that prices might not fall much further.
Traders are keeping a close watch on the $160 support level. On the upside, $194 is the key resistance point, making short-term profit-taking a smart move if the price bounces back.
However, if Solana breaks below $144, we could see even bigger losses. Currently, the risk-reward ratio is sitting at 1:2.
Token Unlock Adds Pressure to Solana’s Price
Adding to the worry, Solana has a token unlock scheduled for March 1st. These unlocks can flood the market with more tokens, often leading to selling pressure.
Historically, token unlocks have made prices jumpy, and everyone’s watching to see how Solana’s supply will react this time.
Related: Samson Mow Sees $1 Million Bitcoin Ahead, Calls Out Ripple and Solana for Over Inflated Prices
Long-Term Solana Value: Utility and Demand in Focus
But it’s not all bad news with reasons to be optimistic. Pump.fun, a Solana-based decentralized exchange (DEX), is reportedly prepping to launch a new automated market maker (AMM).
The goal is to pump up activity on the Solana network, which could balance out the price decline. This AMM would let users trade crypto directly against pools of funds in smart contracts, cutting out the need for a middleman.
An X update from “trenchdiver” on February 24th first mentioned the beta launch of an AMM on Pump.fun, with a link to their platform.
Can Pump.fun’s AMM Turn the Tide for Solana?
If Pump.fun’s new AMM actually boosts trading volume and network activity, it could strengthen Solana’s utility and demand. This might prop up the price in the long run.
Still, in the short term, general market sentiment and macroeconomic factors could still weigh down on Solana’s price.
Related: $SOL vs. $ETH: Could Solana Overtake Ethereum for the #2 Spot in Crypto?
Whales May Be Behind Solana Dip, Some Traders Speculate
Despite the gloomy price outlook, some traders think this downturn is planned—a clever tactic by big investors (“whales”) to buy up more Solana before major positive news, like a possible Solana ETF approval.
With big holders selling off and smaller investors hesitating, the next few days are make-or-break for Solana. We’ll soon see if SOL bounces back or keeps falling to lower support levels.
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