Solana’s (SOL) price is struggling to maintain its upward trajectory, especially after multiple unsuccessful attempts to establish $161 as a support level in the last two months.
A recent failure to break through this level has resulted in a 13% drop in SOL’s price, bringing it down to $139. As the cryptocurrency continues to endure persistent downward pressure, traders are left contemplating if more declines are forthcoming.
Solana Traders Have a Strategy in Play
Currently, the macro momentum for Solana is indicating a bearish trend, as demonstrated by critical technical indicators. The Relative Strength Index (RSI) has dipped below the neutral threshold of 50.0, indicating a rise in bearish momentum. The RSI’s position in the bearish territory hints that selling pressure is growing, with no clear signals of a potential reversal soon.
Following Solana’s unsuccessful effort to surpass the $161 resistance level, the accumulation of bearish sentiment has intensified. With the RSI showing no signs of recovery, it seems that SOL will likely encounter additional downward pressure in the near term, potentially leading to further price declines.
Read more: Solana vs. Ethereum: An Ultimate Comparison
The market sentiment regarding Solana has also taken a downturn. Traders are positioning themselves to leverage potential declines by entering short contracts in the Futures market. Currently, these short contracts exceed long ones, as traders aim to profit from a drop in SOL’s price.
This shift in sentiment is further supported by Solana’s funding rate, which has turned negative for the first time in more than two weeks. A negative funding rate indicates a predominantly bearish market, with traders bracing for potential losses in the short term.
SOL Price Prediction: Seeking Support
Solana is currently priced at $139, just under the local support level of $140. Given the prevailing bearish momentum and negative market sentiment, a decline to $124 seems increasingly likely. This level previously served as a support for SOL last month, when the cryptocurrency showed a rebound from it.
Nonetheless, if Solana fails to maintain the $124 support level, it could fall to $120, establishing the lower boundary of the consolidation range beneath $161. This would signify a deeper decline for the cryptocurrency, making it susceptible to further losses.
Read more: Solana (SOL) Price Prediction 2024/2025/2030
Conversely, if Solana successfully converts $140 into a solid support level, there may be an opportunity for it to rise back toward the $160 range. Should it surpass the local resistance at $155, this would negate the current bearish outlook, allowing SOL a chance to recover and potentially gain ground in the upcoming weeks.
Disclaimer
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