Solana (SOL), the sixth-largest cryptocurrency by market cap, has made a notable recovery over the past 24 hours, rising by 5.52%. Trading at $144, the altcoin is now showing promising signs of a bullish comeback after a series of price fluctuations. Investors are closely watching Solana’s price action, with many hoping that the recent uptick may be a precursor to a more substantial rally, potentially targeting the $157 level.

Solana’s Recent Price Action and Recovery

Solana’s price faced significant pressure in recent weeks, as it had dipped to a low of $130 on March 4. However, buyers stepped in to push the price higher, leading to a 1.18% recovery by the end of the day. The price action formed a Doji candle pattern, indicating market indecision, but the lower price rejection near the $130 mark has provided significant support. This suggests that there are still many buyers in the market willing to step in at lower price levels.

The support level at $130, backed by multiple intraday candles, signals that Solana could be gearing up for a potential bounce. Although the overall market sentiment remains cautious, the formation of these long-tail candles indicates that Solana may be on the verge of a significant price rebound.

Key Technical Indicators for Solana

The daily chart reveals a critical pattern that could determine the next steps for Solana. The death cross between the 50-day and 200-day Exponential Moving Averages (EMA) raised some concerns among traders, signaling a bearish market structure. However, the convergence of the MACD and Signal lines suggests that market momentum is uncertain at the moment, and the next few days could be pivotal in deciding the trend’s direction.

Despite the bearish crossover on the EMAs, Solana has maintained strong support at $130, which could lead to more upside in the short term. If the price continues to hold above this level, it may face resistance around the $157 level, which aligns with the 23.60% Fibonacci retracement level. Should Solana manage to break past this key resistance, it may trigger a rally toward $177, where the 38.20% Fibonacci retracement level lies.

Growing Supply Pressures Could Impact Solana

While Solana’s recent recovery is encouraging, there are potential risks on the horizon. Growing supply pressures could pose challenges for the altcoin’s rally. A recent report from LookonChain revealed that a crypto whale had unstaked a massive 134,902 SOL tokens, valued at $19.3 million, and placed limit orders to sell them at prices between $171 and $294.8. This indicates that some large investors are expecting higher prices and are positioning themselves to offload their holdings when the market reaches those levels.

Furthermore, the ongoing unstaking of FTX/Alameda’s Solana holdings could also add to market supply. The release of 58,964 SOL tokens from FTX’s wallet could place additional downward pressure on the price if these tokens are sold on exchanges. As more SOL tokens are unlocked and sold, the supply could rise, potentially hindering a continued upward movement.

What’s Next for Solana?

Solana’s market outlook remains uncertain, as the cryptocurrency struggles with growing supply pressures and ongoing market volatility. However, the altcoin is still holding above key support levels, particularly around $130, and could attempt to rally toward $157, if the current momentum continues. Traders should keep an eye on key technical levels, such as $157, which could mark a crucial resistance point. A successful breakout above this level would pave the way for Solana to test higher levels near $177.

On the other hand, if Solana fails to maintain its position above $130, a bearish continuation could send the price back toward the $100 mark, a psychological support level. With both bullish and bearish factors in play, Solana’s price trajectory in the coming weeks will largely depend on how the market reacts to key levels and external supply pressures.