Solana Is Under Critical Support For The First Time In Three Years: It Needs To Break This Price! - Coin Newsletter

Solana's native cryptocurrency SOL, with the recent drop, fell below the average cost level of 134 dollars for the first time in about three years, worrying investors.

The selling pressure that has been prevailing in the cryptocurrency market since the beginning of the week has deeply affected Solana (SOL). The SOL price has dropped by approximately 11% since Monday, falling to $111.

According to the data analysis company **Glassnode, this level shows that the realized price of the token, which has been around $134 for the first time since May 2022, has fallen below (realized price). The concept of realized price expresses the average cost of all tokens at the time they last moved.

The decrease in SOL price could have a serious psychological impact on investors. Current prices indicate that SOL holders are on average losing money, meaning investors are currently at a loss. If this situation continues, it is suggested that panic selling and mass exits could be triggered. However, according to technical analysis, for the SOL price to rise back to the 134 dollar level, the 120 dollar support needs to remain strong and then the 128 dollar resistance needs to be overcome with significant volume.

Inflation debate affects the LEFT

Another reason for the price drop of the Solana network during this critical period is highlighted as a new inflation proposal that validators have started to discuss in the network. The proposal presented with the code SIMD-0228 suggests that Solana's annual inflation rate can be reduced from 4.7% to approximately 1.5%. If this change is accepted, significant effects are expected to emerge in the token economy in the long term.

Analysts point out that SOL is clearly in a downtrend at the moment, stating that the support around $120 is of critical importance. If the support level is broken, the next stop is highlighted as $115. However, in case of buying interest from the bottom, a return to $134 in the short term seems possible.