Solana (SOL) Price Drops Below $100 – Analyst Opinions Diverge

Solana (SOL) price has gradually declined after reaching a high of $126 on December 15, 2023.

SOL broke out of a descending resistance trendline today, but is still trading inside a symmetrical triangle pattern.

Solana tries to stop the bleeding

Daily time frame technical analysis shows that SOL price has been rising along a steeply ascending support trend line since October 2023. The upward movement culminated with a high of $126 in December.

The price has since fallen, creating several long upper wicks (red icons).

Despite the decline, Solana price has bounced off the ascending support trend line and is trading above it. So far, the trend line has existed for 95 days.

SOL/USD daily chart. Source: TradingView

The daily RSI is trending lower. The RSI is a momentum indicator used by traders to gauge whether a market is overbought or oversold and whether to accumulate or sell an asset.

Readings above 50 and an uptrend suggest that bulls still have an advantage, while readings below 50 indicate the opposite.

The indicator generated a bearish divergence (green) before the decline. A bearish divergence occurs when a decrease in momentum accompanies an increase in prices. It often leads to bearish trend reversals. The RSI has since dropped and is trading right at 50.

What do the analysts say?

Cryptocurrency traders and analysts on X have a mixed view of the future trend.

MuroCrypto is bullish. He tweeted a breakout and retest, predicting the price would rise.

SOL/USDT 1 hour chart. Source: X

Altcoin Sherpa believes Solana’s price will drop, tweeting:

$SOL: I still think this will go down overall, but I’ll hold onto the stock for a while. Rises on this in 2024

However, Bluntz Capital is also bullish, noting the same breakout and retest as Muro Crypto as to why SOL will rise.

SOL Price Prediction: What to Make of the Price Movement?

A closer look at the six-hour time frame does not help determine the direction of the SOL trend as the price action shows mixed signals.

On the bullish side, the price action shows a breakout from a descending resistance trendline and its validation as support.

However, there is also a short-term symmetrical triangle (dashed). The triangle often serves as a continuation pattern. Since it occurs after a downward move, it will likely lead to a collapse.

Furthermore, the possibility of a SOL price split is in line with wave counting.

Technical analysts use Elliott Wave Theory to ascertain trend direction by studying long-term recurring price patterns and investor psychology.

The most probable wave count suggests that the triangle is part of wave B in an ABC (white) corrective structure. Giving the A:C waves a 1:0.618 ratio will lead to a low near $78.

This is near the major horizontal support area at $75. A similar target is given by projecting the length of the triangle to the breakout level. To achieve this, a 25% decrease is required.

Six-hour SOL/USDT chart. Source: TradingView

Despite the bearish forecast of the SOL price, a break of the triangle will mean that the local bottom has been hit. Then, SOL can rise 18% to the next resistance at $117.

For BeInCrypto’s latest cryptocurrency market analysis, click here.

Disclaimer

In line with Trust Project guidelines, this article on price analysis is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to providing accurate and impartial reporting, but market conditions are subject to change without notice. Always conduct your research and consult a professional before making any financial decisions. Please note that our Terms and Conditions, Privacy Policy and Disclaimers have been updated.

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