Solana (CRYPTO:SOL) has experienced a 5% drop in the past 24 hours, sparking concerns of further declines.
Multiple technical indicators suggest that Solana may face continued downward pressure in the near term, potentially falling to around $130.
A key indicator of this bearish trend is the formation of a rounding top pattern, a U-shaped signal indicating a reversal from a bullish to a bearish trend.
Currently, Solana's price is hovering near the critical neckline support level of $142.87.
A break below this level could confirm further downside, while a break above might invalidate the bearish outlook.
The Bull Bear Power (BBP) indicator, which measures the balance between buyers and sellers, is currently in negative territory, reflecting stronger selling pressure over buying interest.
This suggests that Solana’s price may see further declines if the selling pressure continues to increase.
Analysis of Solana’s liquidation heatmap reveals a significant concentration of liquidity between $130 and $138.
This liquidity concentration indicates potential support levels but also suggests that, without sufficient buying pressure, Solana's price could be drawn down into this range.
If the bearish scenario unfolds, SOL could drop by around 8.8%, reaching the lower target of approximately $130.09.
However, there is also notable liquidity near the $162 level.
Should the broader market conditions improve, Solana could rebound and target this higher price point.
Further analysis using the Fibonacci retracement indicator shows that SOL is close to sliding below the 38.2% retracement level at $142.09.
A continued downtrend could push the price down to the 23.6% level at $129.85.
Conversely, if buying momentum gains strength, Solana could see a recovery toward $161.87.
As market conditions remain uncertain, traders should watch these levels closely for potential shifts in Solana's price direction.
At the time of reporting, the Solana price was $144.92.