Key takeaways:
SOL/ETH has broken below a rising wedge pattern, signaling a potential 40% decline.
Solana’s memecoin revenue has collapsed since April, weakening its core value proposition.
Standard Chartered warns Solana may underperform as Ethereum’s L2 ecosystem grows more competitive.
Solana’s (SOL) multiyear outperformance against Ethereum’s native token, Ether (ETH), is losing momentum, with technical breakdowns and weakening onchain activity pointing to a potential sharp decline in the SOL/ETH pair next.
SOL enters rising wedge breakdown stage
As of May 29, the SOL/ETH pair has confirmed a breakdown from its multimonth rising wedge pattern, a bearish structure that often precedes significant declines.
In technical terms, a rising wedge breakdown typically results in a drop equal to the pattern’s maximum height.
SOL/ETH weekly price chart. Source: TradingView
For SOL/ETH, this projects a downside target for July, near 0.038 ETH, representing a 40% decline from current levels.
The 50-week exponential moving average (50-week EMA; the red wave) around 0.0628 ETH