Solana (SOL) continued to fall after Wednesday’s cryptocurrency market selloff, as higher-than-expected U.S. inflation weighed on risk assets. Weakening network activity is also making SOL’s recovery prospects more challenging.
SOL is trading around $103 after losing support from an ascending trendline near $111. Whether it can hold the psychological $100 level, along with trading activity and the number of active addresses on Solana, are factors to watch in the near term.
MAIN CONTENT
U.S. CPI rose 3.7% year over year in September, above the 3.6% forecast, heightening concerns that interest rates will remain elevated.
Trading volume on Solana fell to its lowest level of the week; JUP and RAY dropped 9.4% and 10.6%, respectively.
SOL is below its 20-day and 50-day EMAs; losing the $100 level could intensify downward pressure.
U.S. inflation weighs on SOL and DeFi tokens
U.S. CPI came in higher than expected in September, heightening concerns that interest rates will remain elevated. U.S. Treasury yields and the dollar both rose, putting pressure on SOL and other risk-sensitive assets.
The decline spread to DeFi tokens in the Solana ecosystem. Jupiter (JUP) and Raydium (RAY) were among the biggest decliners, while network activity also weakened.
U.S. inflation data and the performance of JUP and RAY Indicator Data Context U.S. CPI in September Rose 3.7% year over year Above the 3.6% forecast Jupiter (JUP) price Fell 9.4% Among the DeFi tokens with the sharpest declines in the Solana ecosystem Raydium (RAY) price Fell 10.6% Among the DeFi tokens with the sharpest declines in the Solana ecosystem
How much has Solana network activity weakened?
Trading volume on Solana fell to $20.25 million, its lowest level of the week, while the number of daily active addresses stood at 3.74 million. The decline in both metrics may reflect weakening participation.
Solana activity metrics Metric Recorded level Trend Trading volume $20.25 million Fell to its lowest level of the week Number of daily active addresses 3.74 million addresses Declined
The simultaneous decline in trading volume and active addresses is consistent with cautious sentiment following the inflation report. If this trend continues, concerns about weakening demand for the Solana ecosystem will be further supported.
Source: Santiment
The $100 level is SOL’s short-term test
SOL is trading around $103, below its 20-day and 50-day EMAs, after breaking below rising trendline support near $111. If the price continues to lose the psychological $100 level, downward pressure could intensify.
SOL price levels and technical signals Level or indicator Status Rising trendline support near $111 Broken a few days ago Price around $103 Below the 20-day and 50-day EMAs Psychological $100 level If breached, the decline could accelerate
Source: TradingView
SOL’s ability to stabilize will depend on buying demand returning. An improvement in overall market sentiment alongside a recovery in network activity could support this process. Conversely, sustained selling pressure and continued declines in ecosystem participation could mean the correction is not over.
Summary
SOL is under simultaneous pressure from higher-than-expected U.S. inflation and weakening network activity. With the price below its short-term EMAs, the $100 level is one to watch, while a recovery still depends on buying demand and usage of Solana.
Source: https://tintucbitcoin.com/cu-soc-cpi-lam-kho-solana-khi-kiem-dinh-moc-100-usd/
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