Solana News: Why Is Solana (SOL) Price Down Today?

Solana’s native token, SOL, has recorded a 9% decline over the past week, with a 3% drop on Dec. 19 alone. As of today, SOL trades at $210, 20% below its $264 all-time high reached on Nov. 24. This downturn is influenced by a combination of market-wide sell-offs, declining total value locked (TVL), and reduced on-chain activity.Market-Wide Sell-Off Affects SOL PriceA broader cryptocurrency market correction has weighed heavily on Solana’s price. Federal Reserve Chair Jerome Powell’s hawkish comments about the 2025 economic outlook triggered panic selling. Bitcoin (BTC) dropped 2.7%, and Ethereum (ETH) fell 4.6%, reflecting a general bearish sentiment.The Federal Reserve’s decision to cut rates by 25 basis points was overshadowed by Powell’s post-announcement statements, which revised the 2025 inflation outlook to 2.5% and indicated limited further rate cuts. These developments caused the total crypto market cap to fall 3.8% over 24 hours, resting at $3.53 trillion.Declining TVL on SolanaSolana’s total value locked (TVL) decreased by 4.5% over the last seven days, dropping from $9.37 billion on Dec. 12 to $8.9 billion. Data from DeFiLlama shows that layer 2 protocols like Jito and Sanctum posted significant TVL losses, reflecting reduced interest in Solana-based DeFi applications.This decline in TVL mirrors the drop in SOL’s price, highlighting fading trader interest. On-chain data from Dune reveals a sharp reduction in daily transactions on Solana’s network, nearly halving since Nov. 20. Additionally, daily revenues fell from a year-to-date high of 55,832 SOL ($12 million) on Nov. 23 to 5,391 SOL ($1.13 million) on Dec. 18.Technical Analysis: Bearish Trends and Key LevelsSolana’s price action has painted an inverted V-shaped pattern on the daily timeframe. Resistance at the $215–$230 supply zone, coupled with a Relative Strength Index (RSI) below 50, signals seller dominance. Immediate support lies between $190 and $200, reinforced by the 100-day and 200-day exponential moving averages (EMAs). A close below $190 could push SOL toward $150.Conversely, holding above $200 could invalidate the bearish outlook. Optimistic analysts like Jelle anticipate a breakout, citing Solana’s formation of a falling wedge and higher lows on lower timeframes. “Still believe this one is back in price discovery before Christmas. Bring on $300,” Jelle shared on Dec. 18.Challenges Ahead for SolanaThe current trends indicate significant challenges for Solana, including declining TVL, suppressed on-chain activity, and stiff market resistance. However, the community’s resilience and potential recovery in broader market conditions may support SOL’s price rebound, according to Cointelegraph.