Solana [SOL] has been facing some challenges in regaining the momentum it saw in the fourth quarter of 2024. The lack of steady buying pressure has kept the price of SOL hovering around the $205 resistance zone for the past week. Despite the strong gains towards the end of last year, the cryptocurrency has been struggling to break out of the range between $180 and $260 since November.
Currently, the daily chart shows high volatility for Solana, with the $180 level acting as a crucial support zone. Although there is a high percentage of long positions among top traders and some bullish signs from whale activity, the bulls seem to lack the strength to push the price above $220.
Recent price action has seen SOL bouncing from $188, but it has not been enough to spark a significant recovery. The Chaikin Money Flow (CMF) indicator is below -0.05, indicating a significant outflow of capital from the market. The Accumulation/Distribution (A/D) indicator has been lacking a clear trend since November, reflecting the oscillatory price movement.
On the daily chart, the Moving Average Convergence Divergence (MACD) is below zero, signaling bearish momentum. This aligns with the overall market structure, which turned bearish after the price dropped below $242 in late January. However, despite the current bearish sentiment, Solana maintains a bullish long-term bias, with the $175 and $150 Fibonacci retracement levels holding strong.
The liquidation heatmap for Solana over the past three months highlights a concentration of liquidation levels in the $160-$165 range. This zone could act as a magnetic pull for the price of SOL, drawing it towards this liquidity.
Traders and investors should keep a close eye on the $190 support level, as a break below could trigger a further decline in SOL’s price. A negative turn in sentiment around Bitcoin could also contribute to a potential freefall in SOL. However, for those with a long-term perspective, a retest of the $150-$160 range could present a buying opportunity.
In conclusion, while Solana may be facing some short-term challenges, the long-term outlook remains optimistic. As always, it is essential to conduct thorough research and analysis before making any financial decisions.