The cryptocurrency market commenced the weekend in the red zone, continuing the volatility streak of recent weeks. The liquidity challenges that followed the intense selling and liquidation wave in October carried a negative atmosphere into Saturday morning transactions. Among the altcoins hit hardest by this weak outlook was Solana, which has lost significant momentum in recent months.
New Trend Indicated by Rising Address Activity
As of the time this article was prepared, Solana’s price showed a downward trend over the past week with an 11% loss, trading at $125.94, despite remaining flat over the last 24 hours. This decline extended from November 14 and marked the fourth consecutive day of losses. Solana’s price has eroded considerably since its peak of $253 on September 18, reflecting a value loss of 49% according to on-chain analytics platform Santiment.
During this period, Solana lost the significant support levels on its daily chart, including the 50 and 200-day moving averages at $179.99 and $179.93, respectively. This downward trend confirmed the formation of a death cross, where the short-term moving average falls below the long-term one. Despite red technical indicators, one notable positive development in the market is Solana’s unique positive divergence signal.
Solana’s Positive Divergence: Falling Prices Yet Rising Activity
According to Santiment, while SOL’s price has halved from its peak, interest in the network is noticeably increasing. On-chain address interactions have reached a ten-week high. Moreover, the creation of new SOL wallets is exhibiting strong momentum, presenting a classic example of bullish divergence.
Typically, price drops coincide with reduced network activity, but Solana presents a contrary picture. Santiment interprets this scenario as an "ultimately strong turn signal." Despite the downward price trajectory, the increase in user numbers indicates continuing investor interest in the project, suggesting a potential directional change.
Record in the ETF Sphere: BSOL Surpasses $500 Million
Despite the declining price, Solana demand on the institutional side remains strong. Solana ETFs traded in the U.S. have continued to receive net inflows even during recent downturns. The most significant indicator of this demand is the Bitwise Solana Staking ETF (BSOL).
Within just 18 trading days, BSOL surpassed $500 million in assets under management, making it the largest Solana ETP in the U.S. According to experts, this highlights the positive long-term expectations institutional investors have for Solana.
Meanwhile, recent market news revealed other developments that could affect the Solana ecosystem. Notably, a layer-2 solution based on Solana raised $12 million in its funding round last week. Such investments demonstrate ongoing dynamism on the network’s developer side.
Conclusion
In conclusion, although Solana has faced technical pressure in recent weeks, on-chain data and ETF demand paint a picture contrary to the weak pricing. The increase in user activity despite falling prices could herald a new recovery period. However, with global market conditions still uncertain, it remains to be seen how strong the recovery signals in Solana will develop in the coming days.