Here are the demand and supply areas for next week as Solana dips below $100
The euphoric sentiment of October and early November has long since evaporated. The early December drop in the crypto market saw the price of Solana drop below the $200 mark, and since then the price established a shift in market structure to bearish. Repeated waves of selling have brought Solana prices to $90 at the time of writing, but the pain for late buyers holding on for dear life might not end yet.
Unless the wider market sentiment shifts, Solana could be a risky asset to buy. A recent congestion issue did shake some investors’ faith, which the Solana cofounder Raj Gokal was quoted at the time to have said the network was only “slightly slower for a while” and not “critically flawed”.
Source: SOL/USDT on TradingView
The Fibonacci retracement and extension lines (yellow) were plotted based on SOL’s drop from $204.75 to $130. The 61.8% extension level has seen a temporary stall in the descent of SOL on the charts.
The candlewicks to $105.1 (white) represent a set of local highs that SOL would have to climb above to flip the market structure on lower timeframes. However, above this level lies the 27.2% extension level at $109.67, which coincided with an area of demand (upper cyan box).
Since the price always seeks liquidity, it was possible that SOL would test this $110 area and fool some market participants into buying, before reversing back toward the $70 area in search of demand (lower cyan box).
Source:SOL/USDT on TradingView
The 12-hour RSI has been below neutral 50 in recent weeks, which showed bearish momentum and the presence of a downtrend. It did show a slight bullish divergence in the past few days, which saw SOL bounce to the $105.1 mark before receding. At press time, the RSI found some support at 30 and
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