Solana price has been stuck in a deep bear market as the volume in its decentralized exchanges and futures open interest dipped.
Solana (SOL) has risen for two consecutive weeks and was up by over 33% from its lowest point in August. Still, it remains in a bear market after falling by over 30% from the year-to-date high.Â
Solanaâs DEX volume retreats
Its price action has mirrored that of other cryptocurrencies like Bitcoin (BTC) and Ethereum (ETH), which are all in a bear market.Â
Solanaâs sell-off has happened as the volume in its DEX platforms has fallen in the past few weeks. Data by DeFi Llama shows that its DEX volume dropped by over 45% in the past seven days. In this period, it has handled transactions worth $7.12 billion while Ethereum has processed $8.9 billion.
Solanaâs DEX volume has retreated because of the ongoing meme coin sell-off. Top Solana memes like Dogwifhat, Bonk, Popcat, and Book of Meme have all tumbled by over 50% in the past few months.
Solana has become the most popular chain for creating meme coins, due to fast speeds and low transaction costs. The launch of Pump.fun, a meme coin generator, has made it easier for people to launch Solana meme tokens.Â
Data shows that these tokens have a combined market cap of over $425 million, with Michi, Daddy Tate, Mother Iggy, and Billy being the largest.Â
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Meanwhile, Solanaâs open interest in the futures market has stalled.
According to CoinGlass, futures open interest on Aug. 18 stood at almost $2 billion, the same level it has been in the past five days. The interest is much lower than the July 30 peak of $3.08 billion.Â
Solana futures open interest | Source: CoinGlass
The waning open interest is likely because of the significant liquidations that happened earlier this month as cryptocurrencies slumped.
Solanaâs bulls suffered liquidations worth over $39 million while shorts liquidations totalled $21 million on Aug. 8.Â
Solana has bullish technicals
Solana price chart| Source: TradingView
On the positive side, Solana has found strong support at the 50-weekly moving average, where it failed to move below earlier this month.Â
The coin has also formed a doji pattern, which is characterized by a small body and long upper and lower shadows. It is one of the most popular reversal signs in the market.Â
Additionally, Solana has formed a cup and handle pattern, a sign of a bullish continuation. Therefore, the coin may continue a bullish trend in the coming weeks as buyers target the key resistance of $180.
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