Home Altcoins News Solana (SOL) Risks Dropping Below $110 as Bears Take Control

Solana (SOL) Risks Dropping Below $110 as Bears Take Control

Solana Price Dropping

Solana (SOL) has been experiencing a significant downturn recently, losing over 6% in the past week. Trading below $150 since March 6, the cryptocurrency has shown several bearish signals across key technical indicators. From the formation of a death cross to the rising ADX (Average Directional Index), these signals indicate that Solana’s price could be heading for more downside pressure in the short term.

Ichimoku Cloud Paints a Bearish Picture

One of the primary technical indicators highlighting the bearish trend is the Ichimoku Cloud. The Ichimoku Cloud chart for Solana currently shows a clear negative structure, with price action trading below both the Kijun-sen (the red line) and Tenkan-sen (the blue line). These two lines act as crucial levels of support and resistance. The Lagging Span (the green line) is also positioned below both the price candles and the cloud, reinforcing the bearish sentiment.

The Kumo (the cloud) ahead is red and descending, signaling strong resistance and indicating that the price is likely to remain under pressure. The thin nature of the current cloud suggests weak support, making Solana vulnerable to further downside momentum if this bearish trend continues.

Solana has been struggling to break above short-term resistance levels and remains stuck within a downward channel. For a potential reversal, Solana would need to push above the Kijun-sen and make its way toward the cloud. However, given the current trend, the outlook remains negative.

DMI Indicator Shows Sellers in Control

Another key technical indicator to consider is the Directional Movement Index (DMI), which measures the strength and direction of a trend. Solana’s DMI chart shows a sharp rise in the ADX, now at 40.87, up from 19.74 just a few days ago. This increase signals a strengthening downtrend, as values above 25 indicate a strong trend and values above 40 represent a very strong trend.

Alongside the rising ADX, the +DI (positive directional indicator) has dropped from 17.32 to 8.82, while the -DI (negative directional indicator) has climbed to 31.09. The persistent dominance of the -DI indicates that sellers are firmly in control, with the downtrend gaining strength. As long as the -DI remains dominant and the ADX stays elevated, Solana is likely to remain under pressure.

The Death Cross Signals More Downside

Solana also recently formed a death cross, which is another bearish signal for the cryptocurrency. A death cross occurs when the short-term moving average crosses below the long-term moving average, indicating that the price trend is likely to shift downward. This technical pattern further suggests that Solana may struggle to reclaim higher levels in the near future.

Key Support and Resistance Levels

Solana is currently approaching a critical support level at $120. If this support breaks, the price could dip toward $112 and potentially fall below $110 for the first time since February 2024. If this level fails to hold, further downside could follow, putting Solana in a vulnerable position.

On the other hand, if buying pressure returns and bulls manage to step in, Solana could experience a rebound. The first resistance level to watch is at $136. If Solana manages to break above this level, it could push toward $147, which has acted as a strong resistance point in recent days.

Conclusion

Solana is currently in a bearish phase, with multiple technical indicators signaling further downside risk. With the Ichimoku Cloud and DMI showing growing negative momentum, the price is vulnerable to dropping below key support levels. If the $120 support level fails to hold, Solana could potentially fall below $110. However, a reversal is possible if the bulls step in, and a breakout above $136 could lead to a rally toward $147. Traders should closely monitor these levels to determine the next potential move for SOL.

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dan saada

Dan hold a master of finance from the ISEG (France) , Dan is also a Fan of cryptocurrencies and mining. Send a tip to: 0x4C6D67705aF449f0C0102D4C7C693ad4A64926e9

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