Solana (SOL) has been facing a challenging phase recently, with its price movements hinting at a possible downturn. The market conditions have not been favorable, failing to offer sufficient support for a potential recovery.
The struggle to maintain upward momentum has led to a significant decline in Solana's price, sparking uncertainty among investors. The decrease in network activity, with active addresses hitting a five-month low, reflects a diminishing investor interest as many seem hesitant to engage with the network.
The lack of notable growth or price recovery in recent weeks has prompted investors to be more cautious. The dropping number of active addresses suggests growing skepticism among Solana holders regarding the token's short-term outlook, potentially exacerbating the downward pressure on SOL's price.
Key technical indicators, like the Relative Strength Index (RSI), indicate that bearish momentum continues to influence Solana's price action. With the RSI currently at a monthly low of 40.66, signaling sellers' control, a shift in sentiment or a positive market catalyst would be needed to reverse the downward trend.
Recent price movements show a 7% decline in 24 hours, with Solana trading at $177 above the support level of $175. However, breaking below the ascending wedge pattern indicates a possible continuation of the decline. If the downtrend persists, maintaining critical support levels could become challenging for Solana.
While a potential further drawdown is projected, the immediate term suggests the price may not drop below $161. Yet, breaking below this level could lead to a deeper decline towards $156 or lower, reinforcing the bearish outlook and delaying any recovery efforts.
On a more positive note, bouncing off the $183 support could propel Solana's price towards $201, particularly if broader market conditions improve. Surpassing the $201 level would be crucial in negating the current bearish scenario and signaling a regained upward momentum, setting the stage for a robust recovery.
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