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Solana (SOL) has recently witnessed a concerning dip, trading below its critical support zone of $172, and has struggled to stay above the $165 resistance level. This trend indicates a possible bearish shift in the market, marking a significant trend reversal from its previous positions near and above the $175 region against the US Dollar. The digital asset is now situated below $170 and has also slipped beneath the 100-hourly simple moving average—a key indicator for traders monitoring short-term price movements. The formation of a key bearish trend line with resistance at $162 on the hourly SOL/USD chart, according to data from Kraken, suggests that SOL could face further hurdles in attempting an upward correction.
The recent decline in Solana’s price can be attributed to its inability to breach the $180 resistance level, mirroring the downturn seen in other major cryptocurrencies such as Bitcoin and Ethereum. This sharp decline has seen the price fall below several key support levels, notably the $175 and $172 markers, before the bears forced it down to test the $155 support zone. At this point, a low was formed at $155, and the currency is now in a consolidation phase, struggling below the 23.6% Fibonacci retracement level of the recent drop from the $173 swing high to the $155 low. This scenario showcases the volatility and the bearish sentiment currently shadowing the crypto market, making a recovery above the $165 resistance a critical challenge for Solana.
On the upside, if Solana manages to overcome the immediate resistance levels, particularly around $160 and then at $162, it could open the door for a potential recovery towards the main resistance at $165, or even the 50% Fibonacci retracement level of the move from $173 to $155. For investors and traders, a close above this resistance might signal a possible shift in momentum, possibly leading to a steady incline towards $172 and potentially, the $180 level again. However, the presence of a key bearish trend line and resistance at these levels indicates that there will be significant hurdles to overcome for a bullish reversal to materialize.
Conversely, if Solana fails to climb above these crucial resistance thresholds, the likelihood of further declines could increase, threatening initial support near the $155 level. A slide below the $150 support could intensify selling pressure, potentially driving the price down to the $135 zone. A continued bearish trend could see Solana approaching the $124 support in the near term. The Hourly MACD and RSI indicators, illustrating a loss of momentum in the bearish zone and a reading below the 50 level respectively, further affirm the bearish outlook. These technical indicators, alongside major support and resistance levels, provide traders and investors with insights into potential price movements and the prevailing market sentiment, highlighting the importance of vigilance in these volatile market conditions.
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