Solana (SOL) Market Analysis – Correction in Progress
Chart Pattern:
The recent price action suggests that SOL has possibly completed a 5-wave impulse from the April swing low and is now entering a corrective phase. A potential Head and Shoulders pattern is also forming on the short-term timeframe, which could accelerate bearish momentum if the neckline breaks.
Correction Outlook (Yellow Scenario):
The downside scenario assumes that the recent top was likely the end of wave 5, and we are now in the early stages of an ABC corrective wave.
Wave A is currently unfolding with strong downward momentum.
Wave B is expected to be a corrective bounce.
Wave C to follow, targeting deeper support levels.
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Key Levels to Watch:
Support Zone (Target Area):
Primary Support Range: $109 – $143
38.2% to 50% Fibonacci Retracement Levels: $132 – $143
Resistance for B Wave (Short-Term Rally):
Standard Resistance: $174.78 – $181.30
Extended Resistance (Overshoot Potential): $183 – $191
Neckline of H&S Pattern (Break Level):
Neckline Support: ~$166
A break below could confirm downward continuation.
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Trade Setup:
Entry (Short Position): $174 – $181 (B wave resistance zone)
Stop-Loss: $192 (above possible overshoot resistance)
Targets:
Target 1: $143
Target 2: $132
Target 3 (extended): $115 – $109
Risk Note:
B waves are unpredictable and can overshoot, so use proper risk management and monitor real-time price action closely.
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Summary:
SOL is likely entering a corrective phase, and current momentum suggests a developing ABC pattern. Watch for a potential bounce toward the resistance zone before a continuation to the downside. A break of the $166 neckline in the H&S pattern could accelerate bearish movement.
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