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Solana (SOL) has been in a bearish trend in the last 24 hours, swaying between an intra-day low and high of $122.44 and $135.81, respectively. At press time, SOL was trading at $122.63, a 9.40% decline from the intra-day high. This decline is attributable to the crypto market sell-off amid worries of price dips associated with Bitcoin's price decline below the $54K level.
Analysts suggest that this drop is not over, coupled with the fact that the German government is liquidating BTC, and there might be further sell-offs due to the Mt. Gox repayment plan. The fall dragged the market capitalization for SOL down by 9% to $56,818,962,166 across this correction period, coupled with a 24-hour trading volume increase of 33% to $4,205,180,791 as traders flocked in to buy the dip.
In the past 24 hours, cryptocurrency markets have tumbled by up to $90 billion. The leading bear in this most considerable correction is Bitcoin, which tagged a 24-hour low of $53,600.
Technically, Solana has formed an inverted cup and handle pattern on the 1D time frame, a bearish sign suggesting that more downsides are possible. Besides, the simple moving average gave a negative crossover, which indicates an increasing bearish sentiment.
Further, the Moving Average Convergence Divergence has shown a dip in the green histogram, hinting at more selling pressure.
If the bearish trend prevails, Solana's price could plummet below the critical support level at $127. Failure to hold this level may likely see it make another major plunge toward $100. Conversely, a bullish turnaround could see SOL move toward the resistance level of $155. Should it hold on to this level, the target could become the next level of resistance at $181.50 in the coming weeks.
As pointed out by analysts, Solana sits poised in a descending triangle pattern, with recent rejections at $155 doing nothing to help foster a V-shaped recovery.
The general expectation is for the price to keep a descending trend that could pull it down to the crucial support area between $124.75 and $119.80. However, a bounce from these levels could see it make way back above $135 and now toward $155.
In this regard, the Solana community still shows optimism in the face of such an outlook, this time around with the buzz being over a possible listing of a Solana ETF and the continued developments in the ecosystem.
Meanwhile, broader markets have yet to prove solid recovery as Solana continues to fight back for resiliency versus recent losses.
Analysts opine it may bounce back strongly if Solana holds its support around $121. If the current level holds, SOL can still recover to maintain the global bullish market structure.
News of VanEck and 21Shares filing for a Solana ETF has created a buzz in the crypto space. This development has lent a positive tilt to the overall investor sentiment, and many are now theorizing that SOL stands to gain the most from an ETF approval.
ETF analyst at Bloomberg, Eric Balchunas, tweeted that the probability of an ETF being approved in the next 12 months rests on new SEC leadership changes and just how political the vibe is. Raoul Pal, CEO of Global Macro Investor, has been highly bullish on Solana, who has invested 90% of his crypto portfolio in SOL.
He pointed to a falling wedge pattern on the chart of SOL's price and indicated a possible upward breakout to come. In addition, Pal noted that extremely low volatility for Solana indicates a significant impending price move.
