Solana Lost 9% Over the Week: Analysts Predict Drop to $74

The cryptocurrency Solana (SOL) lost about 9% of its value over the week amid declining interest in risky assets and heightened expectations of tightening U.S. monetary policy. According to FXEmpire analyst Alejandro Arrieche, the future dynamics of the token largely depend on whether the price can hold above $80.

This level is considered an important area of potential demand. If it is breached, the next target for decline could be $74. At the same time, technical indicators show a pronounced oversold condition for SOL, so a short-term recovery also remains possible.

Expectations of Fed Rate Hike Intensify

On November 10, Christopher Waller, a member of the Board of Governors of the Federal Reserve System, spoke at the Bank of England Watchers Conference in London, where he expressed support for further interest rate hikes.

“I am leaning toward supporting an increase in our policy rate of 25 basis points at the FOMC's December meeting,” Waller stated. In translation: “I am inclined to support an increase in our key rate by 25 basis points at the December meeting of the Federal Open Market Committee.”

At the same time, the Fed representative allowed for a more significant increase, by 50 basis points, if inflation turns out to be higher than his expectations.

Following Waller's speech and new U.S. consumer price data, market expectations for further policy tightening intensified. According to CME FedWatch data cited by FXEmpire, the probability of a rate hike in December increased from 84% to approximately 99%.

This figure reflects the assessment of futures market participants at the time of analysis and does not mean that the Fed's decision has already been made.

Rising interest rates may reduce the attractiveness of cryptocurrencies compared to interest-bearing financial instruments. However, the movement of SOL also depends on liquidity, trader activity, and the state of the Solana ecosystem itself.

Solana Approaches $80 Support

According to FXEmpire, on the daily chart, Solana is approaching the Fair Value Gap (FVG) price gap formed during the August rally.

In technical analysis, FVG denotes an area of uneven price movement where buyer or seller interest may emerge in the future. However, such zones do not guarantee a halt to the market trend.

The analyst highlights support around $80. Its loss could intensify the downward movement and shift market participants' attention to $74. If SOL continues to decline after reaching this mark, the technical picture will remain unfavorable, but there is no confirmed next price target in the original analysis.

An additional factor is the weakening trading activity in Solana's decentralized applications. According to FXEmpire data from DefiLlama, weekly trading volume on the network's decentralized exchanges fell from approximately $17.8 billion in mid-September to $10.8 billion, or by 39.3%. The decline continued for six consecutive weeks.

These data indicate a decrease in trading activity in the segment under consideration, although they do not allow for an assessment of the entire network's usage based on a single indicator.

Oversold Condition Allows for Short-Term Rebound

The daily Relative Strength Index (RSI) of Solana has dropped to approximately 23–25 points. A value below 30 is usually considered a sign of oversold conditions, indicating a strong downward momentum.

Such a situation sometimes precedes a temporary price recovery, especially when approaching previously formed demand areas. However, oversold conditions do not rule out further losses.

If buyers hold the $80 area, a short-term rebound is possible. In this case, the nearest significant recovery target, according to FXEmpire, will be resistance around $95.

Thus, Solana remains under pressure from macroeconomic factors and weak market dynamics. The levels of $80 and $74 will be important for assessing the potential continuation of the correction, while a recovery to $95 will require more sustained demand for SOL.