Solana (SOL) Price Hits Key Resistance, What’s Next?

In the fast-moving crypto world, one altcoin made particularly high waves last week: Solana. Within the top 100 cryptocurrencies by market cap, the SOL price recorded the second highest price increase within the last seven days with 8.5%. And the unexpected surge in price for many has catapulted the SOL token to arguably the most crucial resistance at the moment: the 200-day exponential moving average (EMA).

Looking at the 1-day chart, the Solana share price was able to break above the 38.2% Fibonacci retracement level at $19.71, as predicted in our last chart analysis, and subsequently crossed the psychologically important $20.00 mark. While the first attempt failed, the Solana bulls celebrated a resounding success in the second attempt.

Solana price

However, as predicted in our last price analysis, there was increased selling pressure at the 200-day EMA currently at $21.97, to which the bulls succumbed. Similar to the last week of June, a consolidation may now be needed first to reset the technical indicators. In mid-June, SOL posted a 26% rally, followed by a seven day consolidation (bull flag).

A similar scenario could be possible now. A retest of the 38.2% Fibonacci level at $19.71 could be on the table. Remarkably, the pressure on the bulls is huge as the Solana token has failed to break the 200-day EMA since April 2022. The most recent rejection occurred in April 2023, followed by a 44% crash.

However, the external circumstances in the crypto market are different now. Due to the hope for a Bitcoin spot ETF, new life has been breathed into the altcoin market as well. Solana, despite its strong fundamentals, has been hit particularly hard by the FTX drama and more recently the SEC’s declaration of it as a security. Accordingly, a recovery offers plenty of upside potential.

If the 200-day EMA breaks, the 50% Fibonacci retracement level (at $23.36) would certainly be only a short intermediate level before the yearly high at $27.00, which also coincides with the 61.8% Fibonacci level. A break above this chart level could open the floodgates for an even more massive rally.

However, in addition to a general uptrend in the overall crypto market, this will certainly require a Solana-specific catalyst. For the recent rally, this does not really seem to exist.

Reasons Behind The Recent Solana Price Rally

While there isn’t a specific identifiable catalyst for Solana’s recent pump, several factors seem to be contributing to its upward trajectory. One driver has been the announcement of partnerships with notable entities. For instance, Coca-Cola in Serbia collaborated with Solana’s NFT platform, SolSea, to offer limited edition hoodies accompanied by NFTs during a music event.