Solana (SOL) has experienced a notable 12% pullback from its recent high earlier in the week, positioning itself within a critical support zone over the last day. While some market analysts maintain an optimistic outlook as political events unfold, others caution that Solana’s bullish trajectory could face challenges if it fails to uphold its current levels.
Solana Maintains Crucial Support Zone Amid Market Fluctuations
The cryptocurrency market’s recent correction has also impacted Solana, leading to a dip from its New Year peaks and reaching its lowest point since the late December pullback. Earlier this week, Solana achieved a 17.3% surge from the year’s opening price after successfully retesting the $220 threshold. However, this upward momentum was stymied by a significant 8% decline in Bitcoin’s price over a 24-hour period.
Solana’s value fluctuated between the $190 and $199 range before descending below this band, reaching a low of $182 on Thursday. Within the last day, Solana briefly rebounded above the $190 mark before retreating again to the $185 support zone. Despite this decline, a crypto investor highlighted that Solana still targets a price level of $325, as it hasn’t dropped to the previous low of $175.
The investor expressed confidence, suggesting that due to the sharp nature of the downtrend, an equally sharp uptrend could follow, likely resulting in a “V-shaped rebound.” This pattern may facilitate a quicker achievement of the target price than initially anticipated.
Trader Crypto General emphasized that during this “much-needed correction,” Solana has revisited its prior breakout level. Before the anticipated post-election surge, the $180-$185 range served as a significant resistance level, which Solana eventually surpassed by climbing above $200. This range was later tested as a support area during the late December retracements, providing a bounce zone for the cryptocurrency.
Crypto General predicted a bullish outlook for the coming days, citing the impending political inauguration as a potential market catalyst. With the transition of political power, markets are poised to enter a parabolic phase, potentially boosting Solana to new heights. The trader targets a price of approximately $285.
Key Levels to Watch: Analyst Cautions on Solana’s Current Position
Crypto analyst Ali Martinez issued a warning for Solana investors concerning the cryptocurrency’s current levels, emphasizing the importance of maintaining a position above $180. A breach below this support zone could trigger a 20% to 30% decline for Solana. Martinez identified the $150 to $130 range as a potential target, a level not observed since September and October.
Similarly, analyst Jelle advised monitoring the SOL/BTC trading pair in the coming weeks. The trading pair currently resides in a crucial zone, suggesting that Solana should reclaim the 0.0022 level soon to sustain its bullish momentum, as it presently hovers around 0.0020.
Meanwhile, another market observer noted that Solana’s performance during the first quarter might be restrained due to several factors, including “over-saturated positioning,” a cooling off of the pump-driven metas, and the impending release of FTX SOL unlocks, with a significant unlock scheduled for March. However, the analyst remains optimistic about Solana’s prospects “from Q2 onwards,” predicting it as a “major winner” due to the potential introduction of Solana-based exchange-traded funds (ETFs) and the revival of new pump-driven metas, which could bolster its bullish case. As a result, the analyst foresees Solana reaching a price range of $400-$500 within the year.
As of this moment, Solana is trading at $191, reflecting a 3.3% increase over the daily timeframe.
