As Solana (SOL) fails to reclaim a major resistance area, a market watcher suggested that the cryptocurrency is poised to retest the November lows. However, other analysts predicted that the altcoin consolidation period may end soon.
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Solana Rejected From Key Area
On Friday, Solana faced a nearly 4% correction after trying to reclaim a crucial resistance zone for the second time this week. The cryptocurrency has been trading between the $120-$145 price range since the early November correction, hitting its local lows three weeks ago.
Amid the crypto market’s star-of-the-year rally, SOL jumped over 13% from its yearly opening, breaking out of a three-month downtrend and hitting a one-month high of $143.4 earlier this week.
After being rejected from the upper boundary on Tuesday, the altcoin is now attempting to build a base below the $140 level, where the cryptocurrency has faced strong resistance over the past three months.
Despite the surge, Market observer Crypto Batman predicted that SOL could retrace toward the November lows as a bullish reversal pattern appears to be forming on its one-day timeframe.
In an X post, the analyst noted that the altcoin has been rejected by the strong resistance area, asserting that a local top has formed. As a result, the cryptocurrency’s next support area is around the $128-$130 area, where its unfilled bullish Fair Value Gap (FVG) is located.
Crypto Batman also pointed out that Solana has been potentially forming an inverse Head and Shoulders pattern since the Q4 corrections. According to the chart, the cryptocurrency formed the patterns left shoulder and head during the November and December pullbacks, with the neckline around the $145 area.
Moreover, the recent rejection could signal that the right shoulder has begun forming, which would see the price drop to its late November lows before retesting the pattern’s neckline again and potentially breaking out if the formation is confirmed.
Is SOL Waking Up?
Market watcher King Arthur shared a bullish outlook for Solana, affirming that the altcoin “is finally waking up.” He affirmed that “We’ve been watching that long downward slide for a while now, and it’s so good to see SOL finally breaking free from that falling channel. This is a huge first step, but let’s stay sharp.”
As he explained, breaking above the $143 level is crucial for Solana’s momentum, as it would open the door for a reclaim of the $152 level, lost during the November 13 breakdown.
“If we manage that, I’d say the uptrend is officially back on track with my eyes set on $171.55,” he asserted. However, he warned that a drop below the $133 area would suggest that the price is not ready for bullish continuation.
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Meanwhile, analyst Crypto Jelle pointed out that Solana has been unable to challenge the $200 psychological barrier, chopping below this level over the past few months. He suggested that its recent performance is starting to resemble BNB’s price action.
“Kinda starting to feel like BNB. Sideways for what feels like forever – and then, sudden expansion again. (…) Waiting for the same outcome,” he concluded.
As of this writing, Solana is trading at $134.9, a 2.3% decline in the daily timeframe.
Featured Image from Unsplash.com, Chart from TradingView.com