Disclaimer: The information presented does not constitute financial, investment, trading, or other types of advice and is solely the writer’s opinion.
- Solana fell below an HTF demand zone at $20.
- The price action signaled strong bearish intent, and a move to $17 seemed likely.
Solana [SOL] had formed a short-term range between $20 and $22.2 in the latter half of August. However, recent selling pressure saw the bulls cede control of this support zone to the bears. This did not bode well for long-term investors, as another 12% drop was inbound.
Realistic or not, here’s SOL’s market cap in BTC’s terms
Questions about Solana’s network stability were raised when it was revealed that MakerDAO [MKR] was considering the former as its preferred blockchain. On this note, co-founder Rune Christensen tweeted that the technical quality of the Solana codebase was what NewChain required.
The failure to defend the weekly order block signaled SOL is headed lower- but will we get a retest first?
![Solana [SOL] bulls fails to hold on to the $20 support, here's the next bearish target](https://ambcrypto.com/wp-content/uploads/2023/09/PP-2-SOL-price.png.webp)
Source: SOL/USDT on TradingView
The RSI and OBV pointed toward selling pressure and downward momentum. It was possible that SOL would see a move higher to retest the order block as a bearish breaker block, but such a bounce was not a necessity.
If Bitcoin [BTC] slumped toward $24.8k or lower, it could drag SOL southward quickly. It can be hard for traders to position themselves for such a scenario.
On the other hand, a retest of the $20-$22 area could offer a more ideal entry for short sellers, targeting the 23.6% Fibonacci extension level at $16.94.
The market sentiment continued to favor the sellers as most speculators remained sidelined
![Solana [SOL] bulls fails to hold on to the $20 support, here's the next bearish target](https://ambcrypto.com/wp-content/uploads/2023/09/PP-2-SOL-coinalyze.png.webp)
Source: Coinalyze
How much are 1,10,100 SOLs worth today?
The Open Interest has been relatively flat over the past two weeks when SOL slumped to the $20 support level. Millions of dollars flowed into the futures market when SOL bounced toward the $21.5 level on 29 August.
But the sentiment has since shifted. The late hours of 4 September saw SOL dip from $19.5 to $19.2 and an increase in Open Interest, signaling short-selling activity. The spot CVD has been in a slow decline over the past week as well, although funding rates were positive.
