Expect Solana Crypto Currency To Fall In Value This Year

by 99Crypto

The Solana (SOL) price point is expected to fall to around $70 a token in the coming months as a head and shoulders formation has developed on the daily timeframe. In September 2021, the SOL price reached a support level near $134. It then rallied to set a new record high of $260. This week, it tested the same support level before dropping to a low of $87.73 in recent valuations.

This phase of price action has formed a head and shoulders formation, which has three ascending peaks. It's expected to form a secondary target area between $200 and $210 in the near term. The three peaks have shown support at $134, which is the neckline. A fall below this level would indicate an extended downtrend. For SOL, the distance between its head and shoulders formation and the $137 support level is around $170.

The Solana Trend To This Point

The bearish sentiment that developed during the last week of November came as the SOL price dropped over 22%, which is in line with the decline of other large-cap digital assets. The decline in the crypto market is largely attributed to the US Federal Reserve's decision to end its asset purchase program.

The cheap money policies of the central bank have helped boost the crypto market's valuation significantly. However, with the end of the program, the investors' concerns about the asset's price movement have been eased. Due to the continued decline in the crypto market, SOL will most likely be at risk of forming a head and shoulders formation.

Short-Term Outlook for SOL

Although its longer timeframe chart shows a prolonged bear phase, the short-term outlook for SOL is relatively positive. One of its key factors is that it reached a critical support level of $116 in September 2021.

The other is that its daily relative strength index has also declined to below 30 in the recent months. Due to the nature of the investment and current trading market, it is not recommended to rely solely on the opinions of any news source. Instead, rely on experts in the field.