Solana (SOL) Price Analysis: $77 Incoming?
Solana (SOL) Price Analysis: Potential Drop to $77?
Solana (SOL), the sixth-largest cryptocurrency by market capitalization, is showing signs of bearish pressure despite a recent surge. Let's delve into the technical and on-chain data to assess the situation.
Recent Price Action: At the time of writing, SOL is trading around $108.50, having experienced a 10% increase from $97 in the past 24 hours, accompanied by a 25% surge in trading volume. This increased activity suggests significant trader involvement.
Technical Analysis
Our technical analysis reveals a concerning trend. On April 6th, 2025, SOL broke below its key horizontal support level of $114 for the first time since March 2024. This level has historically acted as a price reversal point, but this time, the pattern failed. A daily candle close below $114 strongly suggests further price declines.
Potential Downside: If SOL remains below $114, historical patterns indicate a potential 30% drop, leading to the next support level at $77. Currently, SOL trades below the 200-day Exponential Moving Average (EMA), confirming a strong downtrend.
The Relative Strength Index (RSI) is nearing oversold levels, indicating significant selling pressure. This combination of technical indicators points to a bearish outlook.
Source: TradingView
On-Chain Metrics
On-chain data reinforces the bearish sentiment. Coinglass data shows $85 million in short positions built at the $113.10 resistance level, while $23.20 million in long positions are at the $108.50 support level. The SOL Long/Short Ratio stands at 0.95, indicating slightly more short than long positions – a bearish signal.
Source: Coinglass
The combination of bearish technical analysis and on-chain metrics paints a picture of a market dominated by bearish sentiment. These significant short and long positions are vulnerable to liquidation if prices move substantially in either direction.
Disclaimer: This analysis is for informational purposes only and does not constitute financial advice. Cryptocurrency investments are highly risky.
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