According to data from CoinMarketCap, Solana (SOL) hasn’t seen any major net price change over the past month. However, looking at daily price movements, the popular altcoin hit a local high near $97 in early May before starting its current downward trend. Right now, the Solana market is mostly bearish, in line with the broader market, as shown by its weekly price drop of 4.09%.
In a post on X on May 30, well-known market analyst Ali Martinez shared a key observation about Solana, pointing out a horizontal channel pattern on the daily chart. To explain, a horizontal channel is formed by two flat, parallel lines that act as support and resistance, with the price moving sideways between them. This usually signals a market in consolidation, where a breakout above resistance (the upper line) is a bullish sign, and a breakdown below support (the lower line) is a bearish sign.
Related Reading: Solana Clings To Critical Multi-Year Support As Breakout Pressure Builds
Solana Near Pivotal Price Point: Will Market Climb To $87 Or Retract To $58?
According to Martinez’s analysis, Solana has been trading within this horizontal channel since early February. During that time, the altcoin has consistently faced resistance around $97.79, after testing it twice in March and April. Meanwhile, the channel’s support sits at a key level of $78.17, based on price visits in February and April.
After the recent price rejection at the upper boundary in May, Solana is now heading toward its usual support at $78.17, with current prices around $83. Martinez explains that market bulls need to make sure this support level holds to keep the range-bound pattern intact. In a bullish scenario, Solana would successfully retest $78.17 and then bounce back to the middle of the horizontal channel at $87. On the other hand, a negative outcome would be a breakdown below this support level. Martinez says that could expose Solana to further losses, with an immediate target of $58, which would mean a potential 30% drop from current prices.
Related Reading: Bitcoin Recovery Rally Or Bull Trap? These Key Levels Hold The Answer
Solana Market Overview
At the time of writing, SOL is trading at $82.91, up a slight 0.22% in the last day. Meanwhile, daily trading volume has dropped 33% to $2.22 billion. These numbers suggest a quiet market, with lower participation and fewer transactions.
Notably, data from SoSoValue shows that US SOL Spot ETFs have maintained positive net weekly performance for four weeks in a row. However, net inflows have been declining since peaking at $58.12 million in the second week of May. These figures fell to $2.36 million in the fourth week of May, an 84% drop from the $15.63 million recorded in the third week.
Featured image from iStock, chart from TradingView
Frequently Asked Questions
Here is a list of FAQs about why Solana needs to stay above the 78 key level based on the analysts perspective
BeginnerLevel Questions
1 What does it mean when an analyst says Solana has a key level at 78
It means that 78 is a very important price point Think of it like a floor If the price stays above it the market is likely stable or bullish If it breaks below the price could drop a lot more
2 Why is 78 so important for Solana
Analysts look at past trading data 78 has been a point where Solana has bounced back up in the past and also a point where it struggled to break through Its seen as a support level a price where many buyers are expected to step in
3 What happens if Solana falls below 78
If it drops below 78 and stays there it could trigger a selloff Other traders might panic and sell causing the price to fall even further possibly to 60 or lower according to the analyst
4 Does this mean Solana is a bad investment if its near 78
Not necessarily Being near a key level just means its at a decision point It could either bounce up or break down Its a signal to watch carefully not a final judgment
IntermediateLevel Questions
5 How do analysts determine that 78 is a make or break level
They use technical analysis looking at historical price charts They identify where the price has reversed direction before 78 is likely a previous low that held or a level where a lot of trading volume occurred
6 What technical indicators support the 78 level
Common indicators include the 200day moving average Fibonacci retracement levels and volume profiles If 78 aligns with one of these it strengthens the levels importance
7 Could Solana dip below 78 and then quickly recover
Yes thats called a wicks or a false breakout But if it closes a daily or weekly candle below 78 thats more concerning A quick fakeout is less serious than a sustained break