Analyst explains why it may not be the right time to purchase Solana
In the past two days, Solana (SOL) has seen its value plummet by over 15%, hitting a trough of $121 on the first of July. The weekly figures show a modest 3% loss, while the monthly view reveals a steeper 19% fall.
Despite the recent slump and a slight uptick in the last day, market analyst Alan Santana, via TradingView, advises against purchasing Solana amidst the current bearish climate, backed by a slew of worrisome market indicators and technical analyses. Since March 2024, Solana’s market activity has been characterized by a bearish consolidation, reflecting uncertainty and lack of direction in the market.
**Market Dynamics and Analysis:**
– **Bearish Consolidation:** The market’s indecision is evident as neither buyers nor sellers have managed to secure a clear direction, with the bearish trend hinting at ongoing downward momentum.
– **Significant Bearish Movement:** Solana’s recent downturn, the most drastic since April 2024, reinforces the bearish sentiment and suggests an increase in sell-off activities.
– **Descending Triangle Breakdown:** The breach of the descending triangle’s support level is a stark bearish indicator, often interpreted as a sign of continued downward trajectory, implying that the previous support levels are no longer tenable.
**Critical Levels to Monitor:**
– **0.618 Fibonacci Level ($88.36):** A pivotal support level, reaching this point would signify a major price correction.
– **0.786 Fibonacci Level ($55.26):** A deeper pullback to this level could offer a more attractive entry point for buyers.
**Current Market Position:**
As of this moment, Solana trades at $139, amidst a robust bullish wave sweeping the cryptocurrency market.
**Investment Landscape:**
According to DeFiLlama, Solana’s Total Value Locked (TVL) stands at an impressive $4 billion, indicating strong growth and investor trust. Yet, the growing bearish forces might push Solana back, potentially to the $130 mark, and if the decline persists, to the support zones at $120, $88.36, and $55.26, signaling a bearish market shift.
While there are hints of an emerging bullish phase, the prevailing market indicators strongly suggest a bearish trend, and immediate investments could lead to losses. It’s crucial for investors to keep a vigilant eye on the market and stay updated with any shifts in technical indicators that may indicate a trend reversal.
**Disclaimer:**
This article is not intended as investment advice. Investment decisions should be made cautiously, and it’s important to remember that all investments carry inherent risks.