Solana price drops below March low. Possible further drop expected.
The cryptocurrency Solana (SOL) has recently been classified as a “security” by the US Securities and Exchange Commission (SEC), which has resulted in challenges to its price movement. Investors are closely monitoring SOL’s performance, with CoinMarketCap currently pricing SOL at $15.45, sustaining a seven-day slump of 23.13%.
The market remains uncertain, and it is unclear whether Solana will be able to recover from its recent downturn and regain its upward momentum.
SOL faces steep decline as support levels are breached
The past week has been challenging for Solana (SOL) as it experienced a significant decline, causing it to breach the crucial support zone ranging from $16.7 to $18.8.
This downward spiral was initiated by a weekend slump that coincided with Bitcoin’s (BTC) retest of $25,000. As SOL dropped below both the trendline resistance and March’s low of $16, it shifted into a bearish bias.
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For SOL to regain bullish momentum, it heavily relies on Bitcoin surpassing $26,600 and successfully crossing the $27,000 threshold. Without this upward movement, the bulls could face challenges in clearing the confluence area situated near $17, which combines bullish order book support and trendline resistance.
If there is a potential rejection at this critical juncture, it may trigger a further decline in SOL’s price, potentially leading it toward the support levels at $14.9 or even $12.8.
Solana Foundation disagrees with SEC label of SOL as security
In separate lawsuits filed on June 5 and 6 against popular cryptocurrency exchanges Binance and Coinbase, the SEC designated the SOL token as a security. The SEC’s classification was based on various factors, including the expectation of profits derived from the efforts of others, as well as the manner in which the tokens are utilized and promoted.
Addressing the SEC’s classification of SOL as a security, the Solana Foundation took to Twitter to express its disagreement. In a statement, the foundation asserted, “The Solana Foundation disagrees with the characterization of SOL as a security.”
By labeling SOL as a security, the SEC signals its intention to subject the token to regulations governing securities, which could have significant implications for Solana and its ecosystem.
The classification will likely prompt further scrutiny and discussions regarding the nature and regulatory status of cryptocurrencies in the evolving legal landscape.
Featured image from APKPure
Solana price in a downward trajectory. Source: CoinMarketCap
SOL market cap currently at $6.16 billion. Chart: TradingView.com