Is Solana (SOL) Signaling a Downside Correction Ahead?

• Solana trades at $165 after a brief spike in the last 24 hours.
• A potential bullish breakout might push SOL above $170.

The crypto market has stepped into a positive outlook as the price movement of assets has recovered in the past few days. Eventually, the overall market has lost its momentum and the market cap has reached $2.29 trillion. 

The fifth-largest altcoin, Solana (SOL) has marked a 0.80% spike and struggling to trade in the bullish outlook for the day. Notably, in the early hours, SOL traded at a high of $170.76. Despite maintaining the price momentum, Solana signaled a brief downside rally and began plunging to the current price levels. 

At press time, Solana trades at $165.87 with the daily trading volume plummeting by over 5.65%, standing at around $3.25 billion, according to CMC data. 

On the other hand, SOL has shown positive momentum in the last seven days, with a 6.45% spike. At the beginning of the week, SOL was trading at $156 and eventually, it climbed to a high of $170. Meanwhile, the total value locked (TVL) of Solana reached $6.468 billion recently, marking its peak since January 2022.

What’s Ahead for SOL Price?

The four-hour technical chart of SOL highlights the current negative market sentiment and the altcoin is in the neutral zone. Moreover, Solana’s daily frame indicates the short-term 9-day moving average above the long-term 21-day moving average. 

The Moving Average Convergence Divergence (MACD) line of SOL is positioned below the signal line, suggesting the downside pressure and the incoming bearish trend. Besides, the Chaikin Money Flow (CMF) indicator stays at 0.15, which indicates the increased money flow with selling pressure. 

Looking at the price chart of SOL, it could test the immediate support level at $161. The price might further dip to a low of $156 range if the selling pressure grows. Conversely, if the bullish momentum returns, SOL could bounce to the $169 mark. Further upside correction will likely push the price to a high of $174. 

Disclaimer: The opinion expressed in this chart is solely the author’s. It does not represent any investment advice. TheNewsCrypto team encourages all to do their own research before investing.