For Solana, the death cross would mark a possible end to the impressive bull run that began in October 2023.
Solana SOL $190.9 24h volatility: 3.0% Market cap: $104.42 B Vol. 24h: $7.68 B has shown remarkable resilience over the past year, maintaining a strong bullish trajectory. However, recent market dynamics indicate that this momentum may be under threat. Despite strong efforts to break past a local resistance level of $138, Solana has failed to rally beyond this key threshold.
This resistance failure has left the cryptocurrency vulnerable, particularly as it now hovers near critical support levels that could determine its future course.
Photo: TradingView
Solana Faces Key Threats
One of the most concerning technical developments for Solana is the looming formation of a “death cross”. This bearish signal occurs when the 50-day Exponential Moving Average (EMA) crosses below the 200-day EMA. For many traders and analysts, a death cross is a warning that long-term bullish trends may be reversing, often followed by a significant decline in price.
For Solana, the death cross would mark a possible end to the impressive bull run that began in October 2023. Investors, who have largely remained optimistic about Solana’s long-term prospects, are now reevaluating their positions as the threat of a market breakdown becomes more imminent.
On the technical front, however, the Moving Average Convergence Divergence (MACD) indicator offers a glimmer of hope. While the broader trend remains bearish, the MACD suggests that short-term bearish momentum may be weakening. This could potentially lead to a temporary bounce for Solana, particularly if the cryptocurrency is able to hold its $124 support level.
Should Solana succeed in maintaining this level, it could stall the downward pressure, providing room for a rebound. Nevertheless, a break below $124 could trigger significant selling pressure, potentially pushing the cryptocurrency down to its next safety net at $120. The $120 level is particularly important as it has acted as a strong support floor since March 2024. If this support is breached, Solana could be in danger of slipping into a broader downtrend.
At the time of writing, Solana is trading at approximately $130, and eyes are on the $124 support level as a possible zone of recovery.
Analyst Warnings Raise Concerns
Crypto analyst Alan Santana has recently raised alarm about Solana’s future. He points out that while Solana experienced strong growth in 2023, the current trends in 2024 are less promising. Santana notes that recent increases in trading volume are now showing bearish signs, leading to a drop in Solana’s price.
He warns that the price could fall by up to 42%, potentially reaching as low as $80. This would mark a significant decline from recent highs. Santana’s concerns are highlighted by Solana’s weak performance despite Bitcoin’s recovery, suggesting that the bullish period for Solana might be ending. Investors are advised to be cautious and consider the possibility of further declines in Solana’s value.
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