Solana’s token SOL has pushed to levels not seen since February, lifted by renewed community confidence in a major network proposal.

Data from CryptoSlate shows SOL briefly rose above $215 this week, gaining more than 6% in the last 24 hours before easing slightly to $214 as of press time. This rally placed the token back at its strongest point since early February, when it last traded near $216.

According to analytics firm Santiment, retail sentiment has turned sharply positive, with investors making nearly six bullish comments for every bearish one. Notably, this is the highest ratio recorded in over two months.

Meanwhile, this price momentum has come despite slowing activity on Solana’s decentralized exchanges.

A Dune Analytics dashboard shows that the network’s daily active traders have dropped by more than 80% from January’s memecoin-driven peak of 5 million. For four straight days, user numbers have remained below the one million mark.

This decline reflects a clear pivot among retail investors on the network towards other blockchains like Ethereum.

Alpenglow update

The latest price momentum coincides with early community support for SIMD-0326 Alpenglow, a proposal described as one of the most significant consensus upgrades in Solana’s history.

The proposal seeks to simplify the network’s architecture by removing legacy components such as Proof of History, Tower BFT, and gossip-based vote propagation.

If implemented, the upgrade would reduce block finalization times to about 150 milliseconds, placing Solana in line with other high-speed platforms designed for trading applications.

Notably, Solana co-founder Anatoly Yakovenko has publicly encouraged the community to support the proposal, describing it as a key step forward.

Unsurprisingly, early voting data indicate strong backing for the change, with 11.6% of Solana stakers endorsing Alpenglow, while only 0.1% have opposed it. Around 100 validators have already cast votes.

The community’s response suggests growing confidence that the network can deliver faster and more reliable performance at scale, even as retail trading activity undergoes a reset from its memecoin-driven highs.

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• Short-term holders trigger correction by locking in gains.
• DOGE trades at $0.234, below key resistance at $0.245.
• Price could test $0.198 if $0.220 support fails.

Dogecoin has shed 15% of its value after reaching a six-month high earlier this month, as a wave of profit-taking among short-term holders triggered a reversal in the memecoin’s recent rally.

The downturn reflects a broader pattern of sell-offs across the cryptocurrency market, where traders are taking gains off the table amid uncertain macroeconomic signals and resistance at key price levels.

At the time of writing, Dogecoin is trading at $0.234, down from recent highs and sitting below the key resistance level of $0.245.

The pullback marks a significant change in sentiment after a period of renewed optimism.

Investor behaviour signals short-term weakness

The realised profit/loss ratio for Dogecoin surged this week, reaching its highest level in six months. This metric tracks the profit or loss recorded by investors at the time of selling.

A sharp rise in this indicator suggests a large number of holders are exiting positions in profit, indicating that confidence in further gains is weakening.

This wave of profit-taking has mostly come from short-term investors, who contributed heavily to DOGE’s recent price correction.

The decision to lock in gains at current levels has put downward pressure on the coin’s price action, suggesting a reluctance to hold through potential near-term volatility.

Market participants are closely watching the $0.220 support level.

If DOGE drops below this zone, it could fall further to around $0.198—a key area last seen in earlier trading cycles.

Long-term holders remain steady amid volatility

Despite the short-term selling, Dogecoin’s long-term outlook may not be entirely compromised.

One key indicator, Liveliness—which measures the activity of long-term holders (LTHs)—continues to decline.

This trend suggests that LTHs are not moving their DOGE, implying they are not joining the sell-off.

This reluctance to liquidate positions has previously served as a stabilising force for Dogecoin during periods of intense market activity.

The declining Liveliness could act as a cushion, slowing the pace of the current correction and potentially preventing a full breakdown in price.

Market analysts often view the behaviour of LTHs as a bellwether for a coin’s resilience.

Their current stance suggests that Dogecoin may still have underlying strength, provided the support levels hold and broader sentiment doesn’t worsen further.

Critical resistance could define next move

Dogecoin’s short-term trajectory will likely hinge on whether it can reclaim the $0.245 resistance level.

A breakout above this threshold could invalidate the current bearish setup and open the door to a recovery towards $0.268.

On the other hand, continued profit-taking without fresh buying momentum could see DOGE extend its losses.

If the $0.220 support gives way, the market could quickly test lower support at $0.198.

As it stands, Dogecoin’s future price action will depend on whether long-term holders can provide enough support to offset the current selling pressure from short-term investors.

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The Bitcoin price has fallen more than -8.8% since Friday when Bybit suffered the biggest crypto hack in history. The flagship digital asset reached a peak of $99,493 late last week, only to retreat to roughly $91,500 at press time, marking a -5.5% decline since Monday. This downturn not only shatters Bitcoin’s attempt to hold above $95,000 but also places it on the verge of losing its critical 97-day trading range between $91,000 and $102,000. Notably, Bitcoin’s price has broken below the descending trend channel that has been in play since January 20.

What’s Next For Bitcoin?

Ari Paul, co-founder and Chief Investment Officer of BlockTower Capital, offered a wide-ranging view on Bitcoin’s trajectory and the broader macroeconomic environment. In a post on X, Paul touched on the potential for continued equity-market weakness and its knock-on effect on digital assets: “My market take: equities in for 4-15 months of pain (I’ll guess 9 months) tied to deflationary government policies (tariffs and mass layoffs mostly). Then it’s a political question – does Trump admin ‘capitulate’ and turn severely inflationary? In vast majority of similar cases in history the answer was yes, but just a low confidence guess to me currently.”

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Shifting focus to crypto, Paul emphasized that while cryptocurrencies may still display short-term correlations with equities, they are inherently on different cyclical rhythms: “What does that mean for crypto? I continue to think crypto and equities are on different cycles rhythms, but that doesn’t negate shorter term correlation. Alts probably follow equities down at least at first (but they’re already down so much, even versus 2021 prices, they may bottom well before equities.)”

Speaking on Bitcoin, Paul predicts that the leading cryptocurrency will “act like a blend of gold and S&P 500,” adding, “if gold remains strong, than that would suggest Bitcoin would outperform losing equities, but maybe not by much. A retrace to ~$73k-$77k seems plausible, I’d probably add there.”

Despite the near-term volatility, Paul remains optimistic: “I remain confident crypto bull market not over, but this is looking increasingly different from prior cycles, maybe substantially slower and longer. My base case is that crypto will lead the general macro inflation turn, so maybe crypto bull run resumes in 6 months and equities turn up in 9. The dates given are just indications of my guesstimates. I place no weight on the exact timeframes.”

BitMEX founder Arthur Hayes also took to X to warn of an imminent downward push. He pointed to the mechanics of Bitcoin Exchange-Traded Funds (ETFs) and futures market arbitrage as potential drivers of increased selling pressure.

“Bitcoin goblin town incoming: Lots of IBIT holders are hedge funds that went long ETF short CME future to earn a yield greater than where they fund, short term US treasuries. If that basis drops as BTC falls, then these funds will sell IBIT and buy back CME futures. These funds are in profit, and given basis is close to UST yields they will unwind during US hours and realise their profit. $70,000 I see you mofo,” he writes.

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Notably, research firm 10x Research published an analysis on Monday indicating that while Bitcoin ETFs—led by BlackRock’s IBIT product—have garnered $38.6 billion in net inflows since their January 2024 launch, much of this capital may not represent straightforward bets on rising BTC prices, aligning with Hayes’ statement.

“Although Bitcoin ETFs have attracted $38.6 billion in net inflows since their January 2024 launch, our analysis suggests that only $17.5 billion (44%) represents genuine long-only buying. The majority—56%—is likely tied to arbitrage strategies, where short Bitcoin futures positions offset inflows,” the firm noted.

Prior to the ongoing price drop, market technician Tony “The Bull” Severino, warned of looming volatility in Bitcoin, noting that the daily Bollinger Bands were hitting extreme tightness—a pattern often followed by a significant price swing: “A decision will be made soon in Bitcoin, as the daily Bollinger Bands reach the third-tightest reading since 2018. In late 2018, record tightness led to a 50% decline in just over a month. In mid 2023, record tightness led to a 200% climb in just over 200 days. Which direction does volatility release?”

With Bitcoin teetering just above $91,000 and the market still reeling from Bybit’s historic hack, the market is at a pivotal juncture. Chart signals, macroeconomic uncertainties, and the unwinding of complex trading strategies collectively draw a clouded outlook with a possible extension of this slump to the $73,000–$77,000 range in the coming months.

Meanwhile, this does not have to herald the beginning of the bear market. Chris Burniske, partner at Placeholder VC, commented via X: “In the middle of 2021:BTC drew down 56%, ETH drew down 61%, SOL drew down 67%, many others 70-80%+. You can come up with all the reasons for why this cycle is different, but the mid-bull reset we’re going through isn’t unprecedented. Those calling for a full blown bear are misguided.”

At press time, BTC traded at $90,537.

Featured image created with DALL.E, chart from TradingView.com