Solana struggles below $138 resistance, raising fears of a major price retracement.
Failure to break key levels could lead to declines down to $90 or $60.
Despite risks, Solana’s increasing Total Value Locked and new DeFi projects show potential.
Solana (SOL) is at a critical crossroads and is showing signs of price instability. Recently, SOL struggled to break through the $138 resistance level. This failure has sparked concerns that Solana might be headed for a major retracement. Investors are watching closely, as significant losses could be on the horizon if the trend continues.
Solana’s Struggles: A Critical Moment in the Market
Solana (SOL) has gained a reputation for its fast transactions and low fees. Yet, recent technical analysis suggests its bullish momentum might be waning. The price has consistently failed to surpass $138, raising alarms among traders.
Analysts are particularly worried about the formation of a “death cross.” This pattern occurs when the 50-day exponential moving average (EMA) crosses below the 200-day EMA. The death cross chart pattern often signals a prolonged downtrend.
If this bearish pattern materializes, Solana could face further declines. Traders are focusing on key support levels, fearing a drop to $90 or even $60. Such a decline could erase many gains from Solana’s previous bull run. This will lead to significant losses for investors.
Short-Term Risks vs. Long-Term Prospects
Despite these immediate risks, there are some positive signs. Solana’s Total Value Locked (TVL) is increasing, showing that the network remains attractive. The emergence of new DeFi projects and liquid staking tokens suggests ongoing expansion. These factors could provide a positive outlook in the long run.
However, short-term risks are substantial. If SOL breaks the support levels at $120 and $115, we can expect a price fall to the 61.8% Fibonacci retracement level at $90 or even $60. As Solana faces this turbulent phase, investors must stay alert. The current market conditions suggest that a significant price retracement could be near.
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