Expect more downside on Solana despite the weekly pump
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Solana has fallen by 14% since the inflation data came up
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The native token has been pumping in the last one week on FOMO
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SOL faces further decline as price is rejected by 50-day MA
Solana SOL/USD has crashed by 14% in the last 24 hours. The losses have erased the gains in the week, which now remain at a positive 6.18%. The weekly recovery was boosted by increasing FOMO on the token and improving sentiment. The cryptocurrency has been experiencing increased retail interest and was mentioned on social trading groups.
SOL took a hit as inflation numbers on Tuesday came at 8.3%, surpassing estimates of 8.1%. The inflation was still below the previous 8.5%, but this may have spooked markets. Eyes will not be on the Fed, which is expected to tighten up the policy to tame prices.
Following the latest decline, Solana is hovering around $33. That despite investors looking at the smart contract platform as a true competitor of Ethereum. Frequent hacks have been responsible, which recently had the founder commenting.
Anatol Yakovenko said that Solana’s frequent network outages are like a curse. He, however, maintains that the network’s security is yet to be compromised. Yakovenko says that the outages have been caused by congestion due to the users entering the network.
Solana rejected by 50-day MA as price falls
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Source – TradingView
From the daily chart, SOL trades below the 50-day MA but above the 20-day MA. The MACD indicator is bullish, but the momentum is declining. Following the dampened sentiment after the inflation data, SOL faces further decline.
Summary
Solana is trading at a low level of $33 after getting rejected by the 50-day MA. The price could fall further as the sentiment remains weak. The next support is at $30.5.
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