Solana (SOL) has experienced a 12% pullback from recent highs, landing in a critical zone over the past 24 hours. Despite some analysts maintaining a positive outlook leading up to Trump’s inauguration, concerns have been raised about the potential loss of bullish momentum if current price levels are breached.
Solana Maintains Crucial Support
In the midst of the market retreat, Solana has retraced from its New Year peak, reaching its lowest point since late December. Following a 17.3% surge on Monday, where SOL briefly touched $220, the cryptocurrency’s upward trend was disrupted by an 8% decline in Bitcoin’s price.
After fluctuating between $190-$199, Solana broke below the lower end of this range, sliding to $182 on Thursday.
Despite the recent dip, Solana managed to stay above its previous low of $175, with a target price of $325 still in play according to a keen observer. The sharp downtrend is seen as a precursor to a swift rebound, potentially leading to a V-shaped recovery that could accelerate the price movement.
Notable trader Crypto General highlighted Solana’s retest of key support levels during the recent correction, emphasizing the significance of the $180-$185 range that previously acted as a resistance turned support zone. As anticipation builds around Trump’s upcoming inauguration, expectations are high for a bullish market trend.
“With Trump taking the oath, markets are expected to start a parabolic season, taking Solana along for the ride. My target is around $285.”
Caution Advised for SOL at Current Levels
Analyst Ali Martinez issued a warning to investors, stressing the importance of SOL staying above $180 to avoid a potential 20%-30% decline. A breach of this level could see Solana plummet to the $150-$130 range last seen in September and October.
Market watchers are closely monitoring the SOL/BTC pair, suggesting that reclaiming the 0.0022 level is crucial to sustaining the bullish momentum, as the ratio currently stands at 0.0020.
Looking ahead, concerns have been raised about Solana’s performance in Q1 due to various factors like market saturation, dwindling pump fun metas, and impending FTX SOL unlocks. However, optimism remains for a strong showing from Q2 onwards, particularly with the potential introduction of Solana-based ETFs and new pump.fun metas.
Current trading data shows Solana at $191, reflecting a 3.3% increase in the daily timeframe.
