- Solana (SOL) has rebounded over 15%, trading above $140 after recent market turmoil and significant whale activity.
- Despite current resistance levels, Solana’s strong support around $120-$128 suggests potential for further recovery alongside broader cryptocurrency market gains.
A Strong Comeback Amid Market Turmoil
Solana (SOL) has shown remarkable resilience, posting gains of over 15% and trading above $140 at the time of writing. This recovery is notable, coming after a severe downturn in the broader cryptocurrency market, which saw a 16% crash in the previous session due to geopolitical tensions and Japan’s interest rate decision. Even Bitcoin (BTC) experienced a decline after a brief rally, highlighting the pervasive bearish sentiment in the market.
Critical Support Levels and Trading Activity
Earlier this week, Solana, the fifth-largest cryptocurrency by market capitalization, breached its critical support level of $121, sparking widespread concern within the crypto community. However, trading volume surged to $9.4 billion, indicating high investor activity in response to the price drop. This surge in trading volume is a strong indicator of investor confidence, despite the turbulent market conditions.
Whale Movements and Market Manipulation
$307 Million SOL Moves to Exchanges Amid Market Recovery
Solana has been under considerable pressure recently, as large investors, known as “whales,” moved around 2.38 million SOL, worth $307 million, to centralized exchanges like Binance and Coinbase. This massive movement pushed SOL below $125 and broke the $118 support level, adding to the bearish sentiment surrounding Solana. The trading volume increased by 235% during this period, as traders reacted to these significant changes.
Experts suggest that this recent dip in Solana’s price may not be a natural correction but rather a result of whale manipulation. A Coinbase angel investor recently posted on X (formerly Twitter), explaining that whales create fear among inexperienced traders, causing them to sell at a loss. This panic selling allows whales to buy back Solana at a lower price, profiting from the market’s fear and uncertainty.
Technical Analysis and Future Projections
Currently, the price of Solana is trading below the crucial 200 Exponential Moving Average (EMA) on a daily timeframe. A daily candle close below the $122 mark could trigger a further 30% drop, potentially driving the price down to $77. Conversely, a strong close above $144 might signal a potential reversal, with the price possibly climbing back to $155.
Market Recovery and Resistance Levels
Solana is bouncing back after its significant drop and is currently trading around $140. The daily chart indicates that SOL has broken above the $140 resistance, suggesting a potential reversal. However, the Relative Strength Index (RSI) is at 39.37, which is not yet oversold. The Moving Average Convergence Divergence (MACD) indicator remains in the red, with the MACD line at -3.73 and the signal line at 2.27, indicating that bearish momentum has not entirely dissipated.
Despite the recent bounce, Solana faces resistance at $144, $153, $159, $170, and $183, which could pose hurdles for any short-term rally. On the downside, the support zone between $120 and $128 is crucial. If SOL cannot hold above $118, it could drop to $83.
In the broader market, Bitcoin (BTC) jumped above $56,000 this morning in Asia as the market recovered, with BTC up 6%, marking its biggest 24-hour gain since May. Other major cryptocurrencies are also experiencing gains, with Ethereum (ETH) up 8%, XRP up 8%, Binance Coin (BNB) up 12%, and Solana (SOL) up 16%.
Josh from Crypto World noted that Solana is holding above the $120-$128 support zone even after briefly dipping below it. The daily RSI suggests that Solana has found a local low, similar to Ethereum and Bitcoin. However, with resistance ahead at $153, $159, $170, and $183, a short-term bounce for Solana is unlikely unless it can maintain its current support levels.
