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Solana: Why The Price Is Dropping Today?
- The drop in Solana's price today is attributed to broader weakness in altcoins due to geopolitical tensions and technical signals converging to impact price action.
- Geopolitical tensions, particularly related to Israel-Iran conflict, triggered a market-wide selloff leading to a $240 billion drop in total crypto market capitalization in a single day.
- Solana mirrored the overall decline, with $503 million in total crypto liquidations, including significant liquidations from Ethereum.
- Historically, altcoins like Solana usually underperform during geopolitical crises as investors seek stability in assets like Bitcoin or exit risk markets entirely.
- Technically, Solana faced resistance at the $147–$155 range, failed to reclaim its 50-day SMA, and encountered a key resistance level at $147.38, leading to a breakdown with bearish momentum confirmed by indicators.
- The next support level to watch for Solana is the June 20 swing low at $136.51, with a potential further decline towards $130 if this level is breached.
- Solana's drop is also indicative of broader altcoin weakness as Bitcoin dominance has increased to 64.24%, and the Altcoin Season Index signals a shift towards 'Bitcoin Season.'
- Despite positive news such as Solana's involvement in Wyoming's WYST stablecoin project, macro factors continue to drive market sentiment, with Solana's correlation to Bitcoin at 0.89, making it susceptible to Bitcoin-led movements.
- In conclusion, Solana's price decline today can be attributed to geopolitical unrest, bearish technical indicators, and a market rotation favoring Bitcoin over altcoins, suggesting further downside risks unless sentiment and technicals improve.
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