Solana (SOL) Loses 57% Since All-Time High, Now Holds at Key Support Zone

Key Takeaways

• Five-wave decline completed at key support zone.
• Fibonacci retracement levels align with potential reversal.
• RSI shows oversold conditions, indicating a possible bounce.
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Solana (SOL) has been in a prolonged downtrend, forming a clear five-wave decline. SOL recently tested a key support zone and showed signs of a potential reversal.

The 4-hour time frame suggests a completed corrective structure, while the 1-hour time frame hints at an upcoming bounce.

SOL Price Analysis

The 4-hour SOL chart reveals a completed five-wave structure. The price is currently testing a major horizontal support zone at around $128.

This decline originated from an ascending channel structure, which was completed at $294 on Jan.19, marking an all-time high. 

The bearish trend intensified after SOL lost the $190 level, which was a key pivot.

The price structure followed Elliott Wave principles throughout the decline, nearly reaching the 0.618 Fibonacci retracement level at $118. This area aligns with a historical support zone, reinforcing the probability of a local bottom.

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The 4-hour Relative Strength Index (RSI) is also at oversold levels, mirroring prior reversal points. A bullish reaction at this zone could confirm the completion of the corrective phase, potentially initiating a new upward cycle.

It may validate the reversal thesis if the price holds above $128 and breaks above immediate resistance at $151 (0.5 Fibonacci retracement).

However, failure to hold the $118 support could lead to a deeper decline toward lower retracement zones.

SOL Price Prediction

On the 1-hour chart, SOL appears to have completed its fifth and final wave of the decline and is showing early signs of a potential recovery.

The price has bounced from the $128 region and is attempting to reclaim higher levels.

The next short-term target is the 0.382 Fibonacci retracement level at $185, which aligns with prior structural resistance. A further upside toward the 0.5 retracement at $151 is likely if the momentum is sustained. 

A stronger breakout could push SOL toward the 0.236 level at $227, signaling a more significant recovery.

However, a failure to gain momentum above these resistance levels may indicate a prolonged consolidation phase. The RSI on the 1-hour chart suggests a minor bullish divergence, hinting at the potential for short-term upside.

Traders should monitor whether SOL can sustain above $128. A confirmed breakout above $152 could trigger a move toward the upper Fibonacci levels, while a drop below $118 would invalidate the bullish scenario.

Key Levels to Watch

• Immediate Resistance: $151 (0.5 Fibonacci retracement).
• Key Resistance: $185 (0.382 Fibonacci retracement).
• Major Resistance: $227 (0.236 Fibonacci retracement).
• Immediate Support: $128 (current local bottom).
• Critical Support: $118 (0.618 Fibonacci retracement).
• Short-Term Target: Above $185 if momentum sustains.
• Invalidation Zone: Below $118, signaling further downside.