The technical chart shows a potential downtrend in the next few months, but many Solana enthusiasts expect a Santa Rally to regain the previous support at the end of this year.
At the time of writing this post, SOL/USD is trading around $14, at least 50% down from its recent low ($30). In the last few weeks, we observed higher volume when Solana broke the support, suggesting the continuation of a long-term downtrend.
Indeed, the fall was due to the FTX liquidity crisis, and it took support around $10; after that, it bounced back, but still, it is sideways, so we cannot expect a huge rally in the next few weeks. On the daily chart, Bollinger Bands lack volatility, and trading volume is also decreasing; it shows a lack of interest from the investors.
However, most cryptos have regained the previous support level or at least faced resistance around that level, but Solana is still trading far below that level. RSI is over 40, and MACD is bullish with a green histogram that reflects a potential upside rally of 50% to $30. Based on our SOL coin price prediction, it is the right time to invest for the short term with a target of $30 and a stop loss of around $10 that would provide at least a 50% return within a few months.
It is interesting to note that $30 is a strong long-term support because SOL found that range as a support in 2021 (May-Jul), but it broke that support with a good volume this year. In the last four weeks, candlesticks were indecisive Doji in the lower Bollinger Band, which shows selling pressure and a lack of confidence from the investors. Moreover, all other technical indicators are bearish at that moment.
Indeed, many experts prefer Solana as a strong contender for Ethereum because it offers faster transactions at a lower price with proof of stake consensus that suggests strong growth in the next ten years. Still, many investors also question sustainability because Solana is in a competitive industry where thousands of other protocols also offer almost the same features.
Based on the technical chart, Solana is long-term bearish, so new investors should not take a long-term buying position. However, you can expect a potential short-term rally of at least 50% (a good chance to book the profit/loss if it happens), but it will be bullish when it crosses $70. If you are already invested in Solana, we suggest holding the altcoin for the next few years, but if you want to trade, you must set a stop loss of around $10.