Solana Battles Bearish Momentum as Key Support Zones Erode
Solana (SOL) has recently faced significant downward pressure, struggling to maintain critical price levels and signaling a challenging period for the cryptocurrency. After failing to settle above the $132 mark, SOL extended its losses, mirroring the broader market's cautious sentiment as it now consolidates below $130, with a potential struggle to initiate a recovery wave.
Solana's Downturn Deepens
The digital asset began a fresh decline after failing to sustain above $132, quickly falling below the $130 and $126 support levels, akin to recent movements seen in Bitcoin and Ethereum. This sharp drop has pushed SOL below its 100-hourly simple moving average, indicating a prevailing bearish trend. A key bearish trend line is notably forming on the hourly chart, establishing resistance around $126, which is crucial for any potential upside movement. The price recently recorded a low at $117 before a modest recovery, climbing just above the 23.6% Fibonacci retracement level of the recent $132-to-$117 downward swing.
Navigating Critical Price Levels
Upside Potential
For Solana to regain bullish momentum, it must overcome immediate resistance near the $125 level, which aligns with the 50% Fib retracement level. The next major hurdle stands at the $126 mark, coinciding with the aforementioned bearish trend line. A decisive close above the $132 resistance zone could pave the way for a more sustained increase, potentially targeting $140 and, if momentum persists, even $144.
Downside Risks
Conversely, if Solana fails to breach the $126 resistance, further declines are likely. Initial support rests around the $119 zone, with the first major support located at $117. A break below this $117 level could send the price tumbling towards the $115 support zone. Should even the $115 support fail to hold, SOL's price could see a more significant drop, potentially reaching the $102 support level in the near term.
Technical Indicators Signal Caution
Current technical indicators paint a cautious picture for Solana. The Hourly MACD for SOL/USD is showing signs of losing pace within the bearish zone, suggesting that while the downward momentum is strong, it might be waning slightly. However, the Hourly Relative Strength Index (RSI) remains below the 50 level, reinforcing the bearish sentiment and indicating that sellers largely control the market. Investors and traders are advised to monitor the $117 and $115 support levels, and the $126 and $132 resistance levels, as these will be pivotal in determining Solana's short-term trajectory.
