Solana (SOL) Price: Falls Below $100 Mark After 20% Decline

TLDR

• SOL has fallen below $100, marking a 14-month low after a 20% crash
• The price decline began after breaking below the $112 support zone
• Technical indicators show SOL in oversold territory, potentially signaling a future reversal
• Despite declining network activity (4.44 million active addresses, down from 9 million in January), loyal investors continue holding
• Recovery depends on SOL’s ability to reclaim the $100 level as support; failure could lead to further drops to $90 or below

Solana’s price has taken a significant hit in recent days, falling below the crucial $100 support level and reaching a 14-month low. The cryptocurrency, which had been hovering around the $120 mark, experienced a sharp 20% decline that has left investors watching closely for signs of potential recovery.

The downward trend began when SOL broke below the $122 and $115 levels, following similar patterns seen in Bitcoin and Ethereum. The decline continued past the $112 support level, putting the cryptocurrency firmly in bearish territory.

Most concerning for investors, SOL has now slipped below the psychologically important $100 mark, trading at approximately $97 during recent intraday sessions. This represents a 20.8% drop in a single trading day.

Solana Price on CoinGecko

Technical analysis shows SOL price is now trading below $105 and the 100-hourly simple moving average. There was a break below a key contracting triangle with support at $118 on the hourly chart of the SOL/USD pair.

The current price action remains bearish, with SOL struggling to rise above the 23.6% Fibonacci retracement level of the downward move from the $121 swing high to the $102 low.

Market Indicators Point to Potential Reversal

Despite the bearish momentum, some technical indicators suggest the selling pressure may be nearing exhaustion. The Relative Strength Index (RSI) for Solana currently sits in the oversold zone, below the critical 30.0 mark.

Historically, when SOL has dipped into the oversold region, the price has often rebounded. This RSI reading suggests that the market may be poised for a short-term recovery if broader market conditions stabilize.

On the upside, SOL is facing resistance near the $105 level, with the next major resistance points at $112 and $116. A successful close above the $116 resistance zone could set the pace for another steady increase, potentially pushing the price toward the $120 and $125 levels.

However, if SOL fails to rise above the $105 resistance, it could begin another decline. Initial support lies near the $102 zone, with major support at $100. A break below this level might send the price toward the $92 zone or even the $84 support in the near term.

Network Activity Shows Mixed Signals

The number of active addresses on the Solana network has recently hit a 6-month low, with around 4.44 million addresses engaging on the platform. This marks a substantial decline from January’s peak of 9 million active addresses.

While this reduction in network activity might appear concerning, it could also indicate that investors are simply waiting for a strong recovery before becoming more active on the network again.

Despite the price downturn, Solana’s loyal investor base continues to hold their positions. This persistent support could potentially prevent further price declines and help stabilize the market.

The liquidation data reveals interesting market dynamics. The 1-month heatmap shows clear bearish sentiment, with massive liquidation clusters between $150-$160 and rising long-side liquidations. Liquidations of long positions have accumulated to $6 billion, while short positions stood at less than $4 billion before reaching their peak.

Recovery Prospects and Future Outlook

Solana’s recovery potential remains a topic of debate among market analysts. If the price manages to break above the $100 mark and hold it as support, positive momentum could return. Investors might capitalize on the current 14-month low, injecting new capital into the network and helping to stabilize the price.

However, if broader market conditions fail to improve, Solana’s price may continue to struggle. A drop below the $90 support level would invalidate the bullish outlook and extend losses.

The market sentiment indicators show a broadly bearish outlook. Crowd sentiment sits at -1.15, while smart money sentiment is at a concerning -5.00. The extreme smart money reading suggests institutional investors have adopted a highly defensive stance, likely due to bearish expectations.

The moderate level of bearishness among retail investors indicates doubt, though they remain hesitant to fully abandon SOL. This mixed sentiment, combined with technical indicators, creates an uncertain short-term outlook for Solana.

For now, the $100 level remains a critical threshold for SOL. Its ability to reclaim and hold this level as support will likely determine its price trajectory in the coming weeks.

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