- Vitalik Buterin came out in support of beleaguered blockchain platform Solana.
- But, bearish pressure against SOL remained strong.
NEW DELHI (CoinChapter.com) — Ethereum founder Vitalik Buterin tweeted support for the Solana network as the blockchain platform continued to battle the impact of the FTX implosion.
Solana’s native token SOL fell more than 56% in Nov. The downtrend resulted from SOL’s exposure to Alameda Research, FTX’s sister company. Moreover, the token shed nearly 95% of its value in 2022 and is trading in single digits for the first time since Feb 2021.
Solana also suffered from its association with Sam Bankman-Fried, with the disgraced crypto guru loudly supporting the SOL token at one time.
Buterin expressed support for the platform, stating that the blockchain platform had an “earnest smart developer community.”
Moreover, the Ethereum founder noted that Solana might have better chances of growing “now that the awful opportunistic money people have been washed out.”
Hard for me to tell from outside, but I hope the community gets its fair chance to thriveButerin stated in the tweet.
Solana peaked in Nov 2021 as it reached an ATH of $260. However, SOL prices plummeted by nearly 97%, which pushed its market cap to $3.5 billion. SOL price fell due to the crypto bear market, the FTX collapse, and technical difficulties.
SOL Tries To Rise, But Bearish Pressure Too Much For The Bulls
Meanwhile, SOL prices spiked after Buterin’s tweet, with the token nearly erasing the losses of Dec 29. However, bears started selling, and the Solana token closed Dec 29 at $9.75 after forming a high near $10.8.
Long wicks on both ends of Dec 30’s daily candle highlight the tussle between the bears and the bulls. But, bearish pressure against SOL price action seems too strong. SOL price formed a daily low near $8.9 after dropping more than 12% on Dec 30.
Furthermore, downward-sloping EMA trendlines underscore the bearish pressure against the Solana token.
If bears continue to defend the $10 price tag, SOL price might fall to test support near $8.5. Moreover, if bulls fail to capitalize on Buterin’s tweet, the Solana token could breach below immediate support and drop to $7.6 before recovering.
The relative strength index continued to be oversold for SOL, clocking at 22.88 on the daily chart. Usually, traders consider oversold RSI levels an indicator of an impending bullish trend reversal.
However, SOL buyers have yet to enter the market in big numbers.
SOL bulls must conquer the resistance near $10 before starting a strong uptrend. A break and hold above immediate resistance might provide Solana the momentum needed to challenge the 20-day EMA (red wave) resistance near $11.9 before downside corrections pare gains.