#TradeFiRevolution Buyers retreated from Solana (SOL) as the coin fell below a key support level.
Solana price has fallen sharply since hitting an all-time high of $295.83 on January 18. SOL is trading at $171.81, down 41% since then.
The altcoin, which has been trading within a parallel ascending channel since 2023, is now trading below the lower line of the channel. This signals a decisive shift in market trends and hints at further price declines.
Bears Take Control as Solana Breaks Years-Old Channel
Solana has been trading within a parallel ascending channel since June 2023 and has now broken below it for the first time in the past year.
Ascending Parallel Channel.
A channel is formed when the price of an asset moves between two parallel ascending trend lines. It indicates a continuing upward trend with higher highs and higher lows. The upper line acts as resistance, while the lower line acts as support.
As with SOL, when the price breaks below the lower line, it signals a break in the uptrend and suggests that selling pressure has overcome the buying power. This break indicates bearish dominance in the SOL market, suggesting further declines as traders exit long positions.
Additionally, the coin has been recording negative Elder-Ray indicators since January 27, confirming the strengthening of the bearish bias against SOL.
Solana Elder-Ray Index
The indicator measures the strength of bulls and bears in the market. When the indicator is negative, bears dominate the market, indicating strong selling pressure and the potential for further price decline.
SOL Targets $136 Amid Weak Buying Pressure
According to the Fibonacci retracement tool, Sol price is at risk of falling to $136.62 if the buying pressure decreases further. If bulls fail to defend this support level, the coin price could drop to $120.72, a low it last reached in September.
Solana price analysis.
However, a recovery in demand for Sol will negate this bearish outlook. In this scenario, its price may attempt to retest the breakout line. A successful retest could push its price above the lower line of the ascending parallel channel towards $220.58.