Solana (SOL) recently experienced a significant price decline, hitting a one-month low. The cryptocurrency has rebounded from a critical support level and is now attempting to reclaim the $200 mark. However, market analysts suggest that if current volatility continues, SOL could fall further, potentially reaching the $150 level.
Key Takeaways
- Solana dropped below the $200 support level, reaching a one-month low.
- Analysts warn of a potential fall to $150 if the $190-$200 range fails to hold.
- Current market conditions show high volatility and general weakness in major cryptocurrencies.
- A bounce from the current support could push SOL towards $250.
Solana Retests Critical Support Zone
On Thursday, Solana's price closed below the $200 level for the first time in nearly a month. This marked a significant shift, as the cryptocurrency had been trading within a range of $120 to $220 since early February. It finally broke out of this range in mid-September.
Just a week prior, strong market momentum and increased corporate treasury purchases propelled SOL to an eight-month high of $253. Many investors had anticipated a continued rally to even higher price points.
Quick Fact
Solana saw a 20% decline in its price over the past week, losing the critical $200 level.
However, recent market pullbacks have impacted most major cryptocurrencies. Bitcoin dropped to $108,000, and Ethereum fell to $3,800. Solana mirrored this trend, experiencing a substantial weekly decline.
Analysts Warn of Further Declines
Several market analysts have expressed concern about Solana's current trajectory. Sjuul from AltCryptoGems noted that SOL was "in freefall after that nasty deviation back into the range."
"If Solana fails to hold the current $190-$200 range, it would be very difficult to find strong support before the demand zone around $150, a level not seen since the start of July," Sjuul stated.
This suggests a significant downside risk if the immediate support levels are breached. The $150 level represents a substantial drop from current prices and would erase gains made over several months.
Market Context
The broader cryptocurrency market is currently experiencing increased volatility. This weakness affects major assets like Bitcoin and Ethereum, influencing altcoins like Solana. Investor caution is high.
Market watcher Wise Crypto also highlighted Solana's precarious position. They described it as a "make-or-break retest" of a critical support zone, emphasizing that the overall market still shows signs of weakness.
Ascending Channel and Potential Breakdowns
According to Wise Crypto, Solana has been trading within an ascending channel since April. The price has historically bounced between the upper and lower boundaries of this channel.
If the recent market volatility continues, SOL could retest the lower boundary of this channel, which is estimated to be around the $177-$188 levels. This zone is crucial for maintaining the long-term upward trend.
Wise Crypto warned, "If this zone breaks, the next major support is down below $150 — so caution is key."
This underlines the importance of the $177-$188 range. A failure to hold this level could trigger a rapid descent towards $150, creating significant losses for investors.
Signs of a Potential Rebound
Despite the bearish outlook from some analysts, there are also indicators suggesting a possible bounce. Wise Crypto pointed out that the Stochastic RSI is signaling oversold conditions. This often precedes a price rebound.
If SOL manages to hold its current support area, a move back towards the $250 barrier could follow. This would represent a strong recovery from its recent lows.
Crypto Batman observed Solana's behavior around its major ascending trendline. He noted that SOL has bounced from this level each time it has retested it. This historical pattern offers a glimmer of hope for a recovery.
- Historical Pattern: SOL has consistently bounced from its ascending trendline.
- Oversold Conditions: Stochastic RSI suggests a potential price reversal.
On Friday morning, SOL indeed bounced from its recent lows and is currently attempting to break above the $200 psychological barrier. This immediate recovery is critical for short-term sentiment.
Key Levels for Solana's Recovery
For Solana to transform the recent pullback into a minor deviation rather than a sustained downtrend, it must achieve a daily close above the $200 level. Maintaining this level over the weekend is also vital.
Analyst Ted Pillows added that if the $200 level is reclaimed and held, the next target would be the $208-$210 area. This range is close to the 10-day Moving Average (MA), a key technical indicator.
Reclaiming and holding above the $208-$210 level would be the first clear bullish sign. According to Pillows, this could then propel Solana's price towards the $216–$220 range, which is near the 30-day MA.
As of this writing, SOL trades at approximately $199, showing a modest 1.4% increase in the daily timeframe. The coming days will be crucial in determining whether Solana can sustain its recovery or if it will succumb to further selling pressure.
