Solana’s onchain and derivatives metrics show no signs of stress, possibly paving the way for a rally to $160.
SOL (SOL), the native token of the Solana network, has been unable to close above $145 since July 3. This lackluster performance can be partially explained by decreased investor interest in cryptocurrencies, which caused the sector’s aggregate market capitalization to drop by 5% in nine days. Despite this, SOL underperformed its competitors between July 3 and July 12, trading down 7.8%, while BNB (BNB) and Ether (ETH) declined 6.5% over the same period.
Traders now fear that SOL’s bearish momentum will continue, even if the broader cryptocurrency market recovers some of its losses. However, Solana's on-chain metrics and SOL’s derivatives indicate that a reversal may be underway, paving the way for a bull run above $160, last seen over five weeks ago.
Some Solana SPL tokens drastically underperformed, which also explains the reduced demand for SOL. When Solana ecosystem participants lose money, less money circulates in its decentralized applications, consequently egatively impacting the demand for SOL. Highlights between July 3 and July 12 include a 24% decline in DogWifHat (WIF), 18% losses in Helium (HNT), and an 18% correction in Jito (JTO).
