Market Wrap: Solana Plunge Highlights Major Cryptos’ Day in the Red

Crypto markets spent much of Monday in the red, with Solana’s SOL token among the biggest losers.

SOL, was recently down more than 6% over the past 24 hours amid speculation that it might be entwined in the ongoing drama surrounding Sam Bankman-Fried’s FTX exchange and his trading firm, Alameda Research. According to a copy of the Alameda balance sheet seen by CoinDesk, Alameda holds $292 million of “unlocked SOL,” $863 million of “locked SOL” and $41 million of “SOL collateral.” One theory is that Alameda might try to dump its SOL tokens in a bid to raise fresh liquidity, wrote CoinDesk’s Jocelyn Yang.

This article originally appeared in Market Wrap, CoinDesk’s daily newsletter diving into what happened in today's crypto markets. Subscribe to get it in your inbox every day.

Bitcoin and ether, the two largest cryptos by market capitalization, had a quieter day, falling about 2% and 1%, respectively, over the past 24 hours. BTC remained comfortably over its most recent $20,000 support level after jumping over $21,000 late last week as investors’ looked with hope at signs the U.S. Federal Reserve would scale back from its current diet of hefty, 75 basis point interest rate hikes.

The CoinDesk Market Index, a broad-based index designed to measure the market capitalization weighted performance of the digital asset market, was trading roughly flat.

A day ahead of the U.S. midterm elections, stocks started the week on an up note as the tech-heavy Nasdaq and S&P 500, which has a strong technology component, rose nearly a percentage point, while the Dow Jones Industrial Average (DJIA) closed up 1.3%.

Safe haven gold joined the crowd in the green, albeit barely, inching up 0.1%. Brent crude oil, a widely watched measure of energy markets, held over $98, the perch it assumed late last week.

By Glenn Williams Jr

FTT’s $22 price is significant when considering the asset’s trading volume. The Volume Profile Visible Range (VPVR) tool determines an asset’s potential areas of support and resistance. It provides a visual representation of trading volume by price level, and indicates areas of high or low agreement on price.

An asset’s price tends to move slowly in “high volume node” areas, as there is generally sufficient market demand at those particular price levels. Prices often move rapidly through “low volume node” areas and can lead to rapid increases or decreases dependent on market direction.

What this implies for FTX is that if its price cannot be defended at the $22 level, buying demand doesn’t appear again until close to $10.

Read the full technical take by CoinDesk analyst Glenn Williams Jr.