Solana has dropped by more than two per cent in today’s trading session extending yesterday’s drop of 9 per cent.
The drop, however, is not surprising considering the bad press the cryptocurrency has received in the past few days. The month started with the news that the cryptocurrency had suffered a seven-hour downtime after its mainnet bet fell out of consensus. Although the team were able to bring the platform back within hours quickly, it highlighted a significant problem within the network. According to reports, Solana could not handle 100 gigabits of data per second, resulting in downtime.
The network outage caused ripples in the market and could be a contributing factor in the recent price drop of the cryptocurrency. Other factors likely impacting the current market downtrend include an industry-wide bearish market and unfavourable market conditions that have spooked investors into avoiding risky assets such as cryptocurrencies.
Solana lost over 30 per cent in April, and the bearish trend seems to be continuing this month. Today trading at $83, Solana is still in a strong bearish move and will likely continue dropping in the coming few trading sessions. Solana has also traded sideways after failing to hit the $78 support level for the past week. Currently, the prices are still trading sideways. However, due to the long-term trend being bearish, there is a very high likelihood of the prices continuing with the trend rather than reversing.
Therefore, my Solana price prediction expects that prices will likely hit the 78 price level. There is also a very high likelihood that the prices may trade below the support soon. This aggressive bearish push can be seen in the chart below, which shows both the Williams Alligator and the RSI indicators giving solid bearish signals.
However, if the prices rise above the $95 price level, my trade analysis will be invalidated. It will also mean a trend reversal. The price level is the latest price high of the current sideways market, and if Solana prices break above the level, then a new bullish trend has been established.
This post was last modified on May 06, 2022, 12:56 BST 12:56