SOL Analysis — Potential for Further Downside?

Solana (SOL) is showing several signals of a further correction. After SOL bounced from its core support level at $125, the price was rejected at the EMA 200.

Currently, SOL is trading below all significant exponential moving averages (EMA). Typically, this is an explicit confirmation of a downtrend. Even worse, the Stochastic RSI is in overbought territory. Plus, the K-line has crossed below the D-line—a typical signal for a potential downside move.

The Facts Summarized:

• EMA 200 rejection: SOL attempted to break above the EMA 200 but was swiftly rejected.

• Overbought Stochastic RSI: The overbought conditions suggest the momentum might be cooling off.

• Downtrend: SOL continues to trade below its EMAs, confirming the bearish structure.

• However, even in case of a move to the downside, the 125-level should serve as an essential support.

A Sign Of Hope — BTC!

While the signals for SOL are mainly bearish, it’s essential to keep an eye on Bitcoin (unsurprisingly).

If BTC continues its upward momentum early next week, this could invalidate the bearish setup for SOL and spark a new push upward. The next few days will be crucial to watch.