The crypto sector is caught in a deep correction and recent reporting shows that most altcoins are down over 70% from their 2021 highs. Solana is one of those lists and investors are confused about whether the token has enough fundamentals to warrant buying SOL at its current price.
Data from Cointelegraph Markets Pro and TradingView shows SOL is down 87.5% from its all-time high and considering the current state of the market, most price breakouts fail to reach daily highs.
Despite the gloomy outlook, there are some potential positives that could make Solana a project to watch once the broader market enters a consolidation phase.
solana mobile
SoL’s price spiked last weekend after a June 23 announcement that the project would release a Solana mobile stack that enables native Android Web 3 apps on Solana.
To go along with the new operating interface for smartphones, Solana also revealed that it will release its “Saga” Android phone via Solana Mobile in an effort to lead the way on Web3-enabled devices.
Web3 and Metaverse are two themes that arose out of the bull run of 2021 and point to a future where blockchain technology is headed. Solana’s move shows that despite short-term struggles, it continues to grow for the foreseeable future and wants to play a part in the widespread adoption of blockchain and cryptocurrencies.
The low-fee nature of the Solana blockchain makes it an ideal candidate for non-fungible token (NFT) projects and gaming dApps, and the release of a technology stack for mobile phones is the next step in broader access to these technologies.
If developers can manage to resolve the issues that led to the Solana network outage, the coin has a chance to be a top contender once the broader market is bullish again.
I think so $sol going through a trough of disillusionment $ETH Back in 2018. Prices in bear markets aren’t just reflective – sentiment is too. @solana There is a vibrant developer ecosystem and its downtime issues can be resolved. This will be clear in retrospect.
— spencernoon.eth (@spencernoon) June 27, 2022
Short-term pain expected, but fundamentals improve
While it is good to see what the distant future may hold, the reality is that the short-term outlook for Solana and the wider crypto ecosystem is rather ineffective.
Insight into the low price points to keep an eye on was offered by crypto trader and pseudonymous Twitter user CryptoTony, who deployment of The following chart warns traders not to fall for the first retest of a key support level.
Crypto Tony said,
“tested the demand zone first hence this response, but you really want to call down already after the first test…”
Based on the chart provided, notable lows for Solana are located at $13.50 and $3.50.
Market analyst and pseudonymous Twitter user Krypto Patel also forecast A strong amount of resistance at the 200-day exponential moving average has led to further downside for the SOL in the near-term.
Krypto Patel said,
“Support turns into resistance after a breakout and retest of the $40 area […] There is resistance facing the 200EMA. Can give downside movement anytime. Sell: $38.5, SL: $43.2, TP: $27.”
related: SOL price is up 75% as Solana shows a bullish reversal pattern
Is SOL in the early stages of recovery?
A more bullish outlook for Solana was offered by pseudonymous Twitter user Trader McGavin, who posted the following chart highlighting important levels of resistance at $60, $74, and $95.
The analyst said,
“Double bottom after breaking out of the wedge and rebounding higher. One of the first to bounce off the bottom and could go to $48.”
The importance of maintaining current price levels was also touched upon by crypto trader and pseudonymous Twitter user Altcoin Sherpa, who deployment of The following chart shows a bullish signal provided by the medium term EMA.
Altcoin Sherpa said,
“$SOL: Still do or die zone in lower time frame; this is the first time we have seen some moderate EMA bullish since March. My current plan is to scalp the mid $30s as I go short High was missed.”
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, so you should do your own research when making a decision.
