Can Solana's price drop to $80 when TVL hits the lowest level in six months?

Between September 18 and November 21, the price of SOL – the native token of Solana – has decreased by up to 52%, reflecting the overall decline of the altcoin market as Bitcoin hit a 7-month low of $80,000. As a result, SOL has lost key long-term support levels, with on-chain data and technical analysis both indicating a risk of further, deeper correction, potentially falling below the $100 mark.

Solana’s TVL drops to lowest level since June

Total Value Locked (TVL) on the Solana blockchain has decreased by more than 34%, down to $8.67 billion – the lowest in 6 months, as of Wednesday, from a peak of $13.22 billion on September 14. Over the past 30 days, Solana’s TVL has consistently remained below $10 billion.

Solana TVL | Source: DefiLlamaAccording to data from DefiLlama, the decline in TVL is mainly due to the liquidity staking activity of Jito, which has decreased by 53% since mid-September. Other major decentralized applications such as Jupiter DEX, Raydium, and Sanctum protocol have also recorded declines of 30%, 46%, and 46%, respectively.

The possibility of SOL continuing to fall below $100 is further reinforced by the decline in network fees, active addresses, and transaction volume on the Solana network over the past week.

Top blockchain by 30-day transaction fees in USD | Source: NansenTotal transaction fees on Solana for the week reached $3.43 million, down 11% from the previous week and 23% from the previous month. Meanwhile, the number of active addresses on Solana’s layer-1 decreased by 7.8% during the same period, while total transactions declined by 6.3% over 7 days.

These figures reflect a decreasing demand for SOL within the Solana ecosystem, putting pressure on the price and market sentiment.

Memecoin trading volume on Solana plunges

The decline in TVL also reflects negative developments for memecoins built on Solana, as most have experienced sharp decreases.

Solana-based memecoins have all fallen by double digits over the weekly and monthly timeframes, with most tokens dropping between 10% and 25% from recent highs.

Performance of Solana-based memecoins | Source: CoinGeckoThis downward trend is accompanied by reduced activity on Solana’s layer-1 decentralized exchanges (DEX). According to Blockworks Research, weekly DEX trading volume related to memecoins on Solana has decreased by up to 95%, from a peak of $56 billion in January to $2.7 billion.

Memecoin trading volume on Solana | Source: Blockworks ResearchThe sharp decline in memecoin trading indicates that Solana’s network activity is weakening significantly, exerting further pressure on demand and the price of SOL.

“Bear flag” pattern signals $90 target for SOL

According to TradingView data, SOL is currently trading below a bearish pennant pattern (bear pennant), indicating a risk of further decline. A bear pennant is a continuation pattern that appears after a strong downtrend, followed by a period of consolidation at low prices.

Breaking below the support line of the bear pennant at $135 last week has opened the door for a new downward move for this altcoin. Technical analysis suggests that the target of the bear pennant pattern is $86, representing approximately a 32% decrease from the current price.

SOL/USD two-day chart | Source: TradingViewBefore reaching this level, SOL may find support at the 200-week EMA at $118, where investors expect strong buying interest.

“A bearish flag pattern is forming on Solana’s 4-hour chart,” trader Grim shared on X on Wednesday, adding:

“I wouldn’t be surprised if Solana soon fluctuates in the $90 to $100 range.”

According to Coinphoton, breaking the support line of the symmetrical triangle at $126 will confirm the selling pressure’s control, leading to a deeper correction toward the $95 level.