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Solana ($SOL), the world’s fifth-biggest cryptocurrency by market cap, is poised for downside momentum as its daily chart flashes a warning sign. On December 3, 2024, the sentiment across the cryptocurrency landscape appears bearish, with assets struggling to gain momentum.
Solana ($SOL) Technical Analysis and Upcoming Levels
Amid the price correction phase, Solana ($SOL) has failed to hold its crucial support level and has fallen below the $227 mark. According to expert technical analysis, after hitting its all-time high, $SOL entered a consolidation phase, forming a bearish head-and-shoulders price action pattern.
In today’s bearish, or rather price-corrective, stance, $SOL breached the neckline of the bearish pattern and attempted to close a daily candle below it. Based on recent price action and historical momentum, if $SOL closes a daily candle below the $226 level, there is a strong possibility it could decline by 10% to reach the $200 mark in the coming days.
On the positive side, $SOL is trading above the 200 Exponential Moving Average (EMA) on the daily timeframe, indicating an uptrend. Meanwhile, the Relative Strength Index (RSI) suggests a potential upside rally in the coming days, as its value is near the oversold zone.
The outflow of $159M $SOL
Despite the bearish outlook, whales and institutions have shown strong confidence and interest in the altcoin, according to the on-chain analytics firm Coinglass. $SOL’s spot inflow/outflow data reveals that over the past four days, exchanges have witnessed a significant outflow of $159 million worth of $SOL.
In the cryptocurrency context, outflow refers to whales withdrawing tokens from exchanges to their wallets, which is considered a bullish sign and suggests a potential upside rally in the coming days.
Considering the outflow, it seems that $SOL investors may be capitalizing on the current market sentiment and price decline by acquiring more assets.
Current Price Momentum
At press time, $SOL is trading near $222, having experienced a 6.55% price decline in the past 24 hours. During the same period, its trading volume surged by 101%, indicating heightened participation from traders and investors compared to the previous day.