Solana
Solana: Why $142 is a crucial support level for SOL price
- Solana is down more than 5% in the last 24 hours alone.
- Some measures and indicators suggest a reversal of the trend.
Market conditions have driven down most cryptocurrency prices, and Solana [SOL] was no exception. The price drop caused the price of SOL to fall to a critical level, which can determine the future course of the token.
Solana approaches support
The last 24 hours have been marked by a clear domination of the bears. According to CoinMarketCapSOL was down more than 5% over the past day.
At the time of writing, SOL was trading at $144.80 with a market cap of over $64 billion, making it the fifth largest cryptocurrency. The price decline has brought down the weighted sentiment of the token.
Thus, the bearish sentiment around SOL was dominant in the market. Its social volume has also decreased, indicating a decline in the token’s popularity in the crypto market.
Source: Santiment
AMBCrypto’s analysis of SOL’s chart revealed that SOL was quickly approaching a crucial support level of $142. If Solana manages to test this support, ten investors can expect a rebound.
But a fall below could be disastrous.
Source: TradingView
In which direction is Solana heading?
To understand what to expect from SOL in the short term, AMBCrypto analyzed data from Santiment. We saw that SOL’s open interest dropped along with its price.
Each time the metric drops, it indicates that the chances of the current price trend continuing are low, suggesting a trend reversal.
Source: Santiment
However, SOL’s funding rate was high, which seemed quite concerning for the token’s price action. Additionally, Solana’s Long Short ratio has decreased, indicating a bearish advantage in the market.
If these metrics are to be believed, SOL price could fall below the $142 support.
Source: Coinglass
The Relative Strength Index (RSI) also remained in favor of the bears as it recorded a slight decline. Nonetheless, a few of the other indicators provided some much-needed relief.
For example, the MACD has shown a bullish advantage in the market. Additionally, after a sharp decline, Solana’s Chaikin Money Flow (CMF) recorded a slight increase, indicating a possible increase in prices.
Source: TradingView
If SOL manages to test its support near $142, investors could then see SOL approach its resistance near $160 again.
Realistic or not, here it is Market capitalization of SOL in BTC terms
AMBCrypto had reported Earlier, the token had already approached this level twice in the past week, but was rejected.
Worst-case scenario: If SOL fails to test support, its price could drop to its next support, near $120-125, within a few days.