Solana falls 10% as ETF streak ends – What will be SOL’s next move?
All the gains that Solana made have been wiped out, and the price is testing the same $120 demand zone once more.
Solana has shed 10% since the high of $140.19 it made on Sunday, the 30th of November.
At the time of writing, it was trading at $126.02 and had recorded its first daily outflow from the spot exchange-traded fund (ETF) on Friday, the 28th of November. This broke a 21-day streak of inflows.
Sentiment did not improve over the weekend, as low liquidity in the late hours of Sunday saw a steep market-wide correction.
The change that Solana developers were proposing would improve long-term scarcity, but also reduce staking rewards.
The proposal would be Solana’s most influential tokenomics decision since launch. It has not yet been approved. What has the impact been on the SOL price trends?
Technical analysis
The trend on the daily timeframe has been decisively bearish. The lower low at $121.66 (cyan), if breached, would signal the next bearish move was in progress.
The recent rejection at $144 meant that this was an important supply zone to overcome.
On the 1-hour chart, Solana was back at the $126.7 long-term support.
The $125-$127 region has been an important demand zone in the past ten days, and could prove itself once more. Overhead, the large imbalance from $129.7 to $137 was an imposing supply zone.
Indicator health check
On both the daily and hourly timeframes, the CMF was below -0.05 to show significant capital outflows. The Stochastic RSI and the moving averages also reflected bearish momentum on both timeframes.
Key levels
The $121.66 and $144.7 were vital for the current structure. A break of one of these levels would indicate the direction of the next move.
As things stand, further downside is likely. This meant that the $95-$105 support zone could be revisited.
In the short term, the $125-$127 support area could drive a minor Solana price bounce. Overhead, the short-term resistance was significant from $130-$137.
Final Thoughts
- Solana faced rejection at the $145 supply zone last Thursday, and the recent Bitcoin reset forced SOL prices to drop 8.65% in 8 hours in the late hours of Sunday/early Monday.
- A bullish response from Solana bulls at $121 is possible, but traders shouldn’t forget that the longer-term trend has been bearish since September.
Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion
