SOL Price Faces Downside Correction
Over the past few days, Solana (SOL) experienced a significant rally, surpassing the $60 level. Like Bitcoin and Ethereum, SOL gained bullish momentum after breaking above $65.
The price even reached a high of around $77.72 before undergoing a downside correction. It dipped below $72 and tested $70. The bears managed to push the price below the 23.6% Fibonacci retracement level of the upward move from the $53.50 swing low to the $77.72 high.
Despite the correction, SOL is still trading above $66 and the 100 simple moving average (4 hours). On the 4-hour chart of the SOL/USD pair, there is a key bullish trend line forming with support near $65.00.
The trend line aligns with the 50% Fibonacci retracement level of the upward move from the $53.50 swing low to the $77.72 high. Immediate resistance is seen near the $72.00 level, followed by a major resistance at around $75.00.
Potential for More Losses
If SOL fails to recover above the $72.00 resistance, further downside movement is possible. The initial support on the downside is near $68.00, while the first major support lies at around $65.00 or at the trend line.
A close below the $62 support could lead to a decline toward the $55 support in the near term.
Technical Indicators
The MACD for SOL/USD on the 4-hour chart indicates increasing bearish momentum, while the RSI is currently below 50.
Major support levels are identified at $65.00 and $62.00, while major resistance levels are seen at $72.00, $75.00, and $78.00.
Source: SOLUSD on TradingView.com
Hot Take: SOL Faces Downside Correction as Bulls Retreat
Solana (SOL) recently experienced a major rally but is now facing a downside correction after reaching a high near $77.72. The price dipped below the $72.00 resistance level and tested support near $70.00. If the bears continue to push the price lower, SOL could decline further towards the $62.00 and $55.00 support levels.
However, SOL is still trading above the 100 simple moving average (4 hours) and has a key bullish trend line forming with support near $65.00, which may help limit the losses. To regain bullish momentum, SOL needs to surpass the immediate resistance at $72.00 and aim for higher resistance levels at $75.00 and $78.00.
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