The cryptocurrency market is no stranger to volatility, and recent analysis from crypto analyst MadWhale suggests that Solana (SOL) may soon encounter additional downward pressure. According to his predictions, SOL is at risk of a decline to $125 as it retests a critical support level.
Solana At Risk Of A Drop To $125 With Support Retest
In a TradingView post, MadWhale indicated that the Solana price could fall to as low as $125, particularly as it approaches the $164 price level, described as a key support level. While this support level has held firm in the past, the analyst cautioned that this occurrence may not be repeated in the current market climate.
MadWhale elaborated that early signs suggest the Solana price could soon dip below this daily support, potentially triggering a decrease of approximately 25%. If this scenario unfolds, the price target to focus on would be $125, a level that aligns with a key monthly support zone. Historically, this area has served as a significant defense against further price declines, making it an essential aspect of today’s market analysis.
MadWhale’s accompanying chart suggests that a break below the $125 support could lead to Solana’s price plummeting as low as $80. Notably, another analyst, PizzaDriver, has also expressed concerns, warning that SOL may experience a crash reminiscent of 2022, possibly dropping into the double-digit range.
Currently, Solana’s price has already experienced a significant downturn, declining over 11% in the past week. According to data from on-chain analytics platform Santiment, market sentiment surrounding Solana has plunged to its lowest levels since the major retracement on January 20th. Traders have voiced their frustrations as SOL fell to a three-month low of $161.
Despite these bearish indicators, there is a glimmer of hope reflected in recent analytics. Santiment highlighted that although conversation rates are exceptionally high and crowd sentiment appears negative, historically this indicates a strong potential for a rebound.
A Rebound Is Also On The Cards
While some analysts like MadWhale and PizzaDriver anticipate further declines for the Solana price, others remain optimistic about a potential recovery. In a recent post on X, crypto analyst Mr. B noted that SOL has started to see signs of recovery after dipping to approximately $160. He pointed out that the crypto rebounded effectively off a daily support level.
Mr. B expressed optimism, indicating expectations for a healthy rebound to the $185 mark. However, he cautioned that if the Solana price fails to breach this point, another drop may follow. Conversely, should Solana successfully push upward, analysts believe that the psychological $200 level could soon be within reach.
As of this writing, Solana is trading at around $172, experiencing a moderate increase of over 3% in the last 24 hours, according to CoinMarketCap data.
