Solana (SOL) has been on a downward trend since reaching an all-time high of $295.83 on January 19. The altcoin currently trades at $226, declining 23% from its peak.

With the bears regaining market control, SOL faces increasing selling pressure and waning demand.

Solana Demand Wanes as Meme Coin Hype Dwindles

The significant surge in the demand for the Solana-based meme coin TRUMP pushed SOL to a new all-time high of $295.83 on January 19. However, following Donald Trump’s January 20 inauguration and the launch of the MELANIA meme coin, TRUMP’s trading activity faded gradually. This resulted in a dip in activity on the Solana network, which has impacted SOL’s performance.

SOL trades at $226 as of this writing, noting a 9% decline over the past 24 hours. This has pushed its price below the 20-day Exponential Moving Average (EMA), a key indicator of weakening momentum. 

The 20-day EMA measures an asset’s average price over the past 20 trading days, giving more weight to recent prices to highlight short-term trends. When an asset’s price falls below this key moving average, it signals a shift in momentum to the downside, suggesting a weakening of the uptrend amid increased selling pressure.

In addition, the setup of SOL’s Moving Average Convergence Divergence (MACD) indicator supports this bearish outlook. At press time, SOL’s MACD line (blue) is poised to break below its signal line (orange).

When an asset’s MACD is set up this way, it suggests a bearish crossover, indicating that selling momentum is building, hinting at a sustained price drop. 

SOL Price Prediction: A Dip Below $210 Is Imminent

If SOL’s selling pressure strengthens, readings from its Fibonacci Retracement tool indicate that its price could fall below $210 to trade at $202.73.

On the other hand, a surge in new demand for the altcoin will invalidate this bearish projection. In that case, Solana’s price could attempt to reclaim its all-time high.

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