1. SOL price decline followed the US Federal Reserve interest rate cut
2. Solana on-chain metrics show solid growth in activity
3. Conclusions on the current SOL situation

Between September 18 and 20, Solana (SOL) surged 16.4% but then dropped by 6% to $143 levels. Investors are examining the reasons for this price weakness and potential signs of a retest of the $120 support level.

SOL price decline followed the US Federal Reserve interest rate cut

The recent gains in SOL price followed a broader altcoin market rally, which saw an 11% increase since September 18, spurred by the US Federal Reserve's decision to cut interest rates. This shift also fueled a rally in the S&P 500 stock index, which reached an all-time high on September 19. However, SOL's price gains appear to have been driven more by macroeconomic factors than any specific developments within the Solana ecosystem. When examining SOL's performance, its recent drop to $143 was greater than the broader altcoin market correction. Investors' tepid response could partly be attributed to the outflows from the Solana network, as measured by the total value locked (TVL).

Solana on-chain metrics show solid growth in activity

Solana's decentralized applications (DApps) TVL declined by 8.5%, from 36.9 million SOL on September 18 to 33.8 million SOL on September 21. These withdrawals affected key platforms, including Jito, Kamino, and Jupiter. Despite this, Solana's decentralized exchange volumes rose by 19% in the seven days leading up to September 23. Positive trends were noted in Orca, Raydium, and Phoenix platforms. Meanwhile, Ethereum's main DEX, Curve Finance, remained flat with $868 million in trading volume over seven days, and Tron's SUN saw a 12% decline.

Conclusions on the current SOL situation

Despite other negative indicators like a decline in TVL, Solana network showed resilience with increasing trading volumes and active users. Decreased TVL should not be the sole indicator of the network's health, as many decentralized applications don't require significant deposits. Robust growth in active addresses and low transaction fees have offset such factors. The data collectively indicates that Solana investors need not be overly concerned with the current price fluctuations, with no signs pointing to an imminent drop to the $120 level.

Analysis of Solana’s current metrics suggests that despite recent fluctuations, the network maintains solid user activity growth. This provides a basis for investors to remain confident in SOL's future.