[DigitalToday reporter Jinju Hong (홍진주)] Solana (SOL) is barely holding above its 50-day moving average around the $75 level, but the market is putting more weight on the possibility of further declines than on a major rebound in the near term.

Decrypt, a blockchain outlet, reported on Aug. 11 that Solana traded down 1.22 percent at $75.06. In the Myriad prediction market, the probability of falling to $40 was reflected at 69 percent, while the probability of rising to $160 was reflected at 31 percent.

The key is the technical trend. On the daily chart, a death cross zone, typically interpreted as a bearish signal, has formed. After recently surging to around $90, the price pulled back to near the 50-day exponential moving average. The current area is a first support level where a rebound can continue, but an assessment has emerged that it is still too early to talk about a trend reversal.

Weakness in Bitcoin and Ethereum is also a burden for Solana. Bitcoin is trapped between a $62,000 support level and a $67,000 resistance level. Ethereum also slid to the $1,825 to $1,850 range after failing to clear resistance at its highs. If major cryptocurrencies do not gain strength, the scale of any altcoin rebound will inevitably be limited. Solana's market capitalisation is about $43 billion.

Chart pivot points are also relatively clear. If Solana regains $77.50 on a daily basis, it would confirm defence of the 50-day line and open the possibility of retesting around $85, where the August high and the 200-day exponential moving average sit. If it slips below $72, the downside could open to $70.58 and then to around $65, the early-July low area.

Technical indicators alone have not set the direction. The relative strength index stands at 50.5, staying in neutral territory. The average directional index, which shows trend strength, is also only 11.9, pointing to a market with weak direction. Decrypt pointed out that Solana is closer to a rebound within a downtrend and that it is hard to see it as a trend-reversal signal until it returns above the 200-day line.

The variables market participants are watching are a network upgrade and a revamp of tokenomics. First, the Alpenglow consensus upgrade aims to cut transaction finalisation time to 100 to 150 milliseconds and has entered community validator testing. The target timing for mainnet application is August, but the schedule is not fixed. Positioning is taking place ahead of the launch, but charts could have a bigger influence until actual implementation.

Proposals related to shrinking supply are also being discussed. Validators are close to pushing SGP-0003, which bundles two changes. SIMD-0553 would introduce resource-based fees and increase daily SOL burns more than 10-fold, from about 650 SOL to 7,500 to 9,000 SOL. SIMD-0550 would raise the annual disinflation pace to 30 percent, bringing forward the time to reach the 1.5 percent inflation floor to 2029 from 2032.

Helius, Jupiter, Drift and Solana Compass expressed support for the proposal. Attention is focusing on the fact that supply-side pressure is a variable that does not immediately show up on charts.

In the end, the key in the short term is whether the 50-day line holds, and in the medium term is whether the 200-day line is regained. Solana is still holding the 50-day line, but, as the outlet put it, the death cross still shows that the easier path is to the downside. In contrast, the bullish scenario starts with holding the 50-day line and the $74.73 to $75.71 range and regaining $77.50. In this situation, the next point to watch is whether confirmation of the upgrade schedule and progress on a supply-reduction plan can change actual price moves.