Solana's maintenance above $120 has fueled expectations for a bull market comeback. However, declining revenue suggests a potential crash in the future.

As the cryptocurrency market is at a potential crossroads of a bull market recovery, Solana is experiencing a slight rebound above $120. Notably, SOL has dropped 14% in the past seven days.

With a slight recovery, expectations are growing for a potential return of the bull market. However, analysts warn that Solana may decline.

Solana sell signal

On the daily chart, Solana's price trend shows a rapid bullish recovery, surging 5.98% on March 11. This ended a series of five bearish candles but failed to establish a new bullish trend.

Solana has pulled back 1.14% intraday, currently trading at $123.94. This short-term reversal may be a retest of the demand turning into a supply range at $130.

Solana has dropped nearly 60% from its historical high of $295. This has led to a 'death cross' event between the 50 and 200 EMA lines.

Additionally, the 100 and 200 EMA lines are about to cross, which will trigger a strong sell signal from the EMA lines.

- The surge in meme coin trading volume has led to a significant increase in demand for block space, as speculators execute large volumes of trades, leading to a continuous increase in transactions per second. This has created a 'SOL wealth effect', pushing up the SOL price, generating more liquidity, and increasing risk appetite.

However, as Solana's price has recently fallen, traders have become more risk-averse. Additionally, the decrease in meme coin activity on the Solana network has also led to a sharp decline in its REV.

Solana's weekly REV has dropped 90% from its historical peak, indicating a significant decrease in the network's ability to generate sustainable transaction fees. As Farmer pointed out:

"The trading volume of meme coins is both unsustainable and profit-driven."

Analysts warn that the SOL price will fall below $1.

Technical analyst Gert van Lagen noted that a double top pattern has emerged in the SOL price trend, supporting the likelihood of a massive crash for Solana. On the weekly chart, van Lagen identified a key double top pattern in Solana's price, indicating that the meme season has now ended.

The analyst also emphasized that the failure rate of unvoted transactions on Solana has risen to 75%. Given the bearish divergence and the double top pattern, the analyst believes there is a high probability of falling below $1.