Solana (SOL) Price Plummets as It Overtakes Ethereum in Profitability

Solana (SOL)  Price Sees Bullish Trend Amid Strong Market Recovery"

0Solana's (SOL) price has been in a bearish rally over the past few days, signaling a strengthening of bearish momentum in the cryptocurrency market. The recent downtrend has seen SOL price dipping to $143.86, marking a 1.60% decline in the last 24 hours and a 2.60% drop over the past seven days. With a circulating supply of 450 million SOL, Solana’s market cap currently stands at $64.61 billion.

Solana (SOL) price chart (source: CoinMarketCap)
Solana (SOL) price chart (source: CoinMarketCap)

Solana's Stage: Bullish Breakout or Bearish Pullback

Solana finds itself at a crucial stage where it could either experience a bullish breakout to reach $160 or face a bearish pullback toward $133. Technical indicators suggest that the market dynamics are not favoring the bears, hinting at a potential major price action that could elevate SOL price levels beyond the upper range. 

However, the volatility in the broader cryptocurrency market, particularly driven by Bitcoin's diverse price action and increasing dominance, adds uncertainty to Solana's near-term outlook.

Technical analysis reveals a mixed picture of Solana's price trajectory. While the daily chart shows SOL price trading within a decisive symmetrical triangle, with the price nearing the apex of the consolidation, the resultant pattern leans towards a bullish price action

SOL Surpassing Ethereum in Profitability

Concurrently, a recent analysis has revealed that Solana has, for the first time, overtaken Ethereum in profitability. This achievement is based on the total economic value derived from transaction fees and miner extractable value (MEV).

The shift indicates a pivotal moment for Solana as it begins to challenge the dominance of Ethereum, particularly in the DeFi sector, where both blockchains compete heavily. This development could attract more developers and investors to the Solana ecosystem, seeking to leverage its lower transaction costs and faster processing times.

Despite the positive news regarding its operational metrics, Solana's price has continued to face downward pressure. Technical indicators suggest that the bearish momentum could persist in the short term. The MACD shows a bearish crossover, while the RSI remains subdued below the 50 mark, indicating that sellers currently dominate the market.

The ascending Relative Strength Index (RSI) supports the bullish claim, indicating a potential for a bullish push. However, the lack of specific dominance between bulls and bears, as reflected in the bull-bear power, adds to the uncertainty surrounding SOL's next move.

SOL/USD 24-hour price chart (source: TradingView)
SOL/USD 24-hour price chart (source: TradingView)

Despite the current bearish momentum, there are indications of a potential breakout for Solana. The formation of a bullish flag pattern suggests a temporary pullback before a strong rally, with key resistance levels at $160 potentially confirming the recovery from the market consolidation phase.

A breakout from the overhead trendline could signal the end of the minor correction and pave the way for a surge in buying pressure. If the bullish scenario unfolds, SOL price could target levels around $184.6 and potentially even $200 in the near term.

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