Following a seven-day surge that saw SOL overtake XRP and become the third-largest cryptocurrency by market value, the price of Solana retraced 6% on November 12.
Solana seems to be able to cling to the $200 support level, even if the market as a whole is struggling.
Evidence from the blockchain indicates that SOL Receivers (purchasers) still outnumber Senders (sellers).
Two Solana memecoins, ACT and PUNT, were listed on Binance on November 11.
Following a seven-day gaining run that propelled SOL to the position of third-largest cryptocurrency by market value, the price of Solana retraced 7% from $225 to $205 on Tuesday.
Following Binance's listing of two newly-launched memecoins housed on the Solana network, on-chain data patterns indicate that SOL might escape dropping below the key $200 support.
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Two significant milestones were achieved by Solana throughout the seven-day rally. First, it has been three years since SOL's market worth was over $100 billion.
The second noteworthy development is the meteoric rise of Solana, a megacap digital asset that has quickly surpassed Ripple (XRP) in market price and is now the third biggest cryptocurrency network.
Nevertheless, Tuesday's dramatic profit-taking wave among Bitcoin dealers set off a domino effect of liquidations throughout the altcoin market, halting the seven-day winning run.
The price movement of Solana in November 2024 | SOLUSD
The price of Solana increased 43.9% from $156 on November 5 to a three-year high of $225 in the early hours of November 12, as seen in the SOLUSD daily chart above.
At the time of publishing, the price of Solana had retraced 6% toward the $212 level, following the market-wide slump.
The overbought condition of Solana increases the likelihood of a protracted correction phase, but patterns in on-chain data indicate that the native memecoins' consistent demand might absorb sell-side pressure in the near future.
As ACT and PNUT are added to Binance's list, SOL's demand remains consistent.
A Binance statement has provided a glimmer of hope for Solana bulls, as big altcoins including as Cardano (ADA) and Shiba Inu (SHIB) had double-digit corrections throughout the course of the day on Tuesday.
Two Solana memecoins, Peanut Squirrels (PNUT) and The AI Prophecy (ACT), were listed on Monday on the Binance exchange.
Market caps for ACT and PNUT increased by over 400% on the first day of trading on Binance.
Market caps of $550 million and $450 million, respectively, reflect the continued high demand for both assets as of this writing.
The demand for native SOL currencies is going up and the selling pressure from the market-wide correction is going down since traders and investors are buying these meme tokens, but they need to pay the transaction fees using SOL coins.
Speculative and long-term investors alike are drawn to Solana's rising popularity, thanks in large part to the recent boom in meme currency trade.
Supporting this view, data collected in real-time by Hellomoon, a blockchain analytics platform native to Solana, reveals that, even with Tuesday's market dip, there are still more active buyers than purchasers on the network.
Hellomoon reports on the Solana network's unique receivers and senders for the month of November 2024.
The number of addresses that bought SOL each day is tracked by Solana's Unique Receivers, which as of press time on November 12 was 4.13 million, as seen above. As a counterpoint, 3.37 million addresses make up the total Unique SOL Senders, which signifies active vendors.
A possible support level for a price recovery is indicated when the number of active buyers exceeds the number of sellers during a market downturn. This is because purchasers tend to accumulate more shares at such time.
Holding the $200 support on Tuesday seems to have been crucial for Solana, since demand for ACT and PNUT, two memecoins that soared to a combined market worth of $1 billion within 24 hours of trade on Binance, has been enormous.
The Solana price is expected to reach $250 soon after the stock closes over $214.
The Solana price has quickly recovered from its short plunge below $205 in the early hours of November 12, reducing its daily time frame losses to only 5%. Bulls may be able to recover for another leg-up, as seen by the increasing SOL purchasing pressure that coincided with Binance's listing of ACT and PNUT.
Due to the fact that Tuesday's drop exposed weak hands, technical indications on the SOLUSD daily chart also support the idea that Solana might have another surge towards $250.
Bollinger bands that are becoming wider indicate that there is a lot of trade activity and very high volatility.
Nevertheless, the continuance of the upward trend is precariously balanced as Solana's price remains below the VWAP at $213.89 and is trading around $212.
If SOL wants to try to break out over $250, it has to close above this important resistance level.
If the Solana price drops below$205, its daily period bottom may provide short-term support.
But if that first level of support doesn't hold, the optimistic prediction might be thrown out the window, and the corrective phase could drag on until it reaches the 20-day moving average price, which is about $182.
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