Solana, Big Reversal After Breaking $96 Resistance?... Risk of Further Plunge If It Fails to Settle in Box Range

▲ Solana (SOL)

An analysis suggests that while Solana (SOL) is attempting a short-term rebound, it has not yet secured a clear upward breakout signal due to market structure. Although short-term momentum showed signs of stabilization, a warning was issued that the current recovery could turn into another corrective wave if it fails to overcome key resistance levels.

NewsBTC reported on May 23 (local time) that Solana continues to trade within a cautious sideways range, with the possibility of a temporary recovery before determining its next major direction. The outlet stated that Solana is facing a critical resistance zone that will determine whether the current rebound leads to a stronger breakout or gets swept back into a corrective trend.

Elliott Waves Academy suggested the possibility of a short-term recovery for Solana based on the 1-hour chart. According to their analysis, the current rebound is a (2)/(B) wave formed as the market attempts to stabilize after recent downward momentum, potentially forming a complex double zigzag structure. For this recovery path to be confirmed, Solana must clearly break above the upper boundary of the current diagonal pattern and also surpass the key resistance line linked to the previous bearish wave.

The primary target zone for this rebound was presented as the 50% to 61.8% retracement level of the previous decline. The possibility of extending to the 78.6% retracement level was also mentioned if further gains continue. However, if the price is pushed back from this resistance zone, it could act as a point where selling pressure intensifies. Conversely, if Solana forms higher lows and continues an impulsive upward trend, the trend could shift towards sustained upward potential, according to the analysis.

MCO Global DE diagnosed that Solana remains trapped within a wide box-range structure that has dominated its price action for several months. This analyst assessed that the market has not yet shown a clear breakout signal, and recent movements observed in lower timeframes are mostly short-term noise. Immediate support was suggested around $81.28, and the main support zone was identified between $71.92 and $77.96.

MCO Global DE stated that the possibility of an additional short-term decline before Solana attempts another recovery within a larger B-wave structure cannot be ruled out. Specifically, the analysis suggests that as long as the key resistance around $96 is maintained, the market remains vulnerable to a deeper correction. Solana's broader trend is expected to remain in a cautious and neutral phase until buying pressure overcomes the major resistance levels around $96 and $110.

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