Solana (SOL) is facing an important crossroads – Recovery or free fall?

Solana (SOL) is currently facing a severe sell-off wave as the cryptocurrency market struggles under the pressure of President Donald Trump's tough trade policies. Concerns about a prolonged trade war and escalating macroeconomic tensions have led investors to withdraw their funds from risk assets en masse — and Solana has become one of the hardest-hit victims. This altcoin has plummeted more than 60% from its recent peak, clearly reflecting the panic sentiment enveloping even the tokens with strong fundamentals.

However, amidst the sell-off storm, a few positive signals still shine through. Renowned analyst Bluntz stated on platform X that he has started to accumulate some oversold altcoins, including Solana, as bullish divergence signals appeared on the RSI indicator. According to him, many tokens have dropped almost vertically — a pattern that often signals strong recovery potential in the short term.

Although Bluntz does not believe this is the true bottom of the market, the formation of bullish divergence on many price charts is bringing a glimmer of hope for risk-seeking traders. With Solana testing important support levels, the market is holding its breath to see if the recovery scenario will come true — or if the correction is not yet over.

Solana at a critical crossroads as the $100 level faces significant pressure

Solana is facing an important turning point both technically and psychologically, as the $100 level continues to be the last stronghold that the bulls must defend. After a severe sell-off over the weekend – when the price plummeted more than 20% in just a few hours – the market clearly reflects a panicked sentiment and increasing uncertainty spreading throughout the cryptocurrency space. Losing the $120 mark is seen as a signal of a significant shift in investor expectations, and if the $100 level is breached, Solana risks falling into a weak support zone, where buying pressure is thinner than ever.

The market landscape has changed as the bulls have lost control, amidst a clear downward price trend that began last week, largely stemming from global macroeconomic instability. The new tariff policy of former President Donald Trump is raising concerns about the possibility of a new trade war, increasing pressure on financial markets that are already fraught with risks. In this wave of sell-offs, speculative assets like Solana are heavily impacted, as investors seek to withdraw capital from altcoins amid rising fears.

Despite this, amidst the haze of negative sentiment, a glimmer of hope still shines through. Analyst Bluntz has begun to open long positions with several altcoins like SOL and HYPE, after these coins lost over 60% of their value in nearly vertical declines. He points out that bullish divergence signals are starting to appear across multiple timeframes – a factor often seen as an early indicator for technical recoveries.

Solana shows bullish divergence on the daily chart | Source: Bluntz "I don't believe this is the 'cycle bottom'," Bluntz said, "but I appreciate the likelihood of strong price bounces in the short term."

Although the long-term trend of Solana is still being challenged, oversold indicators along with potential demand could create opportunities for nimble traders. If SOL can regain and maintain above the $100 mark, a significant recovery could very well be triggered. Conversely, if it fails, the market will face the risk of a deeper decline.

Price Action Details: Important Liquidity Zones

Currently, Solana (SOL) is trading around the $108 level, after a series of volatile days as bulls attempt to defend the strategic support zone at $100. This price level has now become a decisive "frontline" between buying power and selling pressure, amid the fragile market sentiment in the cryptocurrency space, which remains susceptible to macroeconomic instability factors such as escalating trade tensions and a trend of retreating from risk assets.

The bulls are facing a life-and-death challenge: not only do they need to maintain the $100 level to uphold their defensive stance, but they must also push the price above the $120 zone – which was once an important support area, now turned into a strong resistance. Successfully reclaiming this threshold could open the door to a strong recovery and re-establish the short-term uptrend.

SOL/USDT daily chart | Source: TradingViewConversely, if Solana loses the $100 mark, selling pressure could quickly increase, pulling the SOL price down to the $80 range – seen as the next support level with potential buying power. In the context of price action being on a "knife's edge", the upcoming trading sessions will play a decisive role: either SOL will bounce back and recover, or continue to plunge in a deeper correction.

Disclaimer: This article is for informational purposes only and is not investment advice. Investors should conduct thorough research before making decisions. We are not responsible for your investment decisions.

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