- Ethereum and Solana are leading altcoins into a potential bearish storm, despite experts remaining bullish on SOL.
- The crypto market is undergoing a correction phase, with most altcoins currently in the red.
- Both Ethereum and Solana have dropped from their critical support levels, sparking bearish sentiments within the community.
As the crypto market corrects, Ethereum and Solana lead altcoins into a potential bearish storm. However, experts remain bullish on SOL despite the prevailing market conditions.
Ethereum and Solana: Dancing with the Bears
At the time of writing, Ethereum [ETH] and Solana [SOL] have dropped from their critical support levels of $2,995 and $145, respectively. The community is mostly bearish on both tokens, according to data from CoinGecko. Ethereum’s performance has been weaker than Bitcoin’s, with its deepest drawdown reaching 44% over the cycle, more than double that of Bitcoin’s 21%. This highlights Ethereum’s struggles and underperformance relative to Bitcoin. The Short-Term Holder Cost Basis for Ethereum shows that current prices are very close to the cost basis of recent buyers, creating a precarious scenario where any further market dip could trigger a sell-off panic.
Solana: A Silver Lining
Despite the gloomy outlook, Solana seems to have weathered what might have been its last major correction for this market cycle. A well-followed crypto analyst, Inmortal, suggests that Solana only needed to defend the $120 support level. He expects a rally, with projections suggesting a climb to a new high of $320 later this year. Furthermore, indicators suggest that Solana might soon overtake Ethereum in terms of transaction fees. Dan Smith, a senior research analyst at Blockworks, suggested that Solana could surpass Ethereum in transaction fees and capture maximal extractable value (MEV) as early as this month. On the 7th of May, Solana’s total economic value was reported at $2.8 million, nearing Ethereum’s $3.1 million.
Community Bullish on Broader Altcoin Market
Interestingly, the community seems to be highly bullish on the broader altcoin market, especially AI tokens like Fetch.ai [FET]. Meme coins like Pepe [PEPE] and Bonk [BONK] are still seeing new holders every day, suggesting that investors and traders are still very much expecting a bull run for 2024. So, while the bears might have managed to snatch control, it is likely to be temporary.
Conclusion
While Ethereum and Solana are leading altcoins into a potential bearish storm, experts remain bullish on SOL. The crypto market is undergoing a correction phase, but the community remains optimistic about the broader altcoin market. Despite the current bearish sentiments, the expectation of a bull run in 2024 remains high.
