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Solana’s social index is revealing a worrying trend after the altcoin failed to sustain its 40% price increase. On November 5, SOL traded at $161.93, and 17 days later, it hit a new all-time high.
However, despite this rally sparking renewed excitement among the investor community, the lack of continued momentum has pointed to weakening bullish sentiment. With this decline, the question arises: what will the SOL price do next?
Sentiment On Solana Turns Bearish
The impact of the weakening bullish sentiment on Solana is evident in its market capitalization position. Two days ago, SOL was ranked 4th in terms of market capitalization in the cryptocurrency market. However, it lost that position to Ripple (XRP), a token that outperformed other assets in the top 100.
Following this event, Solana’s social metrics, including weighted sentiment, declined. Sentiment weighting evaluates the overall market perception of a Cryptocurrency.
When this index is positive, it implies that the majority of comments about this altcoin are bullish. Conversely, if negative, this means that the majority of comments about this Cryptocurrency are negative. According to Santiment, Solana’s weighted sentiment has plummeted into negative territory, suggesting that the majority of market participants are not optimistic about SOL’s short-term price movements.
If this trend continues over the next few days, demand for Cryptocurrencies may continue to decline. Social media dominance is another indicator that SOL price could face further decline.
Social media dominance measures the level of discussion around Cryptocurrencies compared to other assets in the market. When this index increases, it means that discussions about the asset have increased, which is usually a positive sign.
However, in the case of SOL, the index fell from 8.42% on November 17 to 3.60% today. Given this decline, Solana prices may struggle to recover to all-time highs in the short term.
SOL Price Forecast: Not Time to Recover
From a technical perspective, the 50-period Exponential Moving Average (EMA) on the 4-hour chart has crossed above the 20-period EMA. To clarify, the EMA is a technical indicator that identifies bullish and bearish price trends.
When the shorter EMA crosses the longer EMA, the trend is bullish. But if it’s the opposite, the trend is down. This crossing, known as the “death cross,” represents a downtrend.
Furthermore, SOL price trades below both of these key indicators reinforcing the bearish view. This positioning suggests that the recent rally may have been a mistake. If confirmed, Solana’s value could drop further to $213.15.
On the contrary, if Solana’s social indicators turn optimistic, this trend could change. In that scenario, SOL could recover with a possible target of $264.64.
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