Solana's (SOL) Impressive July Performance May Be Short-Lived as Signs of Price Drop Emerge

Solana's SOL coin had a great July, with its price going up by 27%. It is now close to its highest price this year. But, even with these gains, there are signs that the price may go down soon.

Solana’s native token, SOL, had a stellar performance in July, with a 27% price increase. Currently, its price is close to its highest point this year. But even with these gains, there are signs that prices may soon fall.

At the time of writing, Sol coin is trading at $183.5.

Performance in July

Solana’s SOL coin ended July up 30% in price, approaching this year’s high of $210. The rally was largely driven by excitement surrounding the new meme cryptocurrency token and a robust liquidity staking system on the Solana blockchain network.

$SOLSolana outperforming on the bounce as usualNow breaking out of resistance on a breakout arrow setup that usually starts brand new trends ?Also note the Bottom was once again picked off by our confirmed Bottom setup ? pic.twitter.com/IDLUVezgce

Increased network activity

Solana’s total value locked (TVL) rose 10% to $5.42 billion. This has also led to increased transactions and activity on the network. Liquidity staking projects such as Jito and Marinade have grown by 40% and 30% respectively in the last month.

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Solana protocol ranking. Source: DefiLlama pic.twitter.com/5s9BiIggTq

Staking data

According to data from Dune Analytics, the amount of SOL used for liquidity staking will more than double in 2024. The number of Liquidity Staked Tokens (LST) pledged increased from 163,827 to 807,712, a 393% increase between June 1 and July 26.

Solana ecosystem total staked LST chart source: Dune Analytics pic.twitter.com/MnFCSDzG4B

Signs of falling prices

Despite these stellar performances, there are also signs that SOL’s price may be falling. July's sharp gains may have prompted some investors to sell profits, pushing prices lower. In addition, changes in overall market and investor sentiment may also affect the price of SOL.

With Solana’s price approaching its highest point of the year, investors will be keeping a close eye on any signs of price decline. While the network's fundamentals are strong, the market's reaction to recent gains will be critical to SOL's short-term price.

In short, while Solana’s SOL coin performed well in July, signs that the price may be declining suggest that its upward trend may face challenges in the coming weeks.

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