Solana rallied right along with the rest of the crypto world during the trading session on Monday, breaking above the $120 level initially. The 200 day EMA sits right there as well, so that is an area that a lot of people will be paying close attention to. The market breaking above that would be a very bullish sign, but we still have a significant amount of resistance near the 50 day EMA, where we had sold off drastically to get down here. At this point, we have a lot of questions to ask about the market, and as a result it is likely that we will see a lot of volatility.
Keep in mind that Solana is simply following the Ethereum market as well as Bitcoin, and if they continue to go higher, then it is likely that Solana will follow right along. After all, Solana got absolutely hammered right along with everything else, losing well over 50% quite handily. The $100 level underneath will be an area where we have seen a lot of interest, and that could be basically where we are trying to turn the entire thing around. This is not to say that we will simply turn around and take off to the upside rather quickly, but it looks as if it could be an area where we build a little bit of a base. A short-term pullback could be a nice buying opportunity, especially if we see one of the big coins do the same thing.
On the other hand, if we were to turn around and break down below the $80 level, that could send this market much lower, perhaps reaching towards the $50 level. I do not necessarily see that happening, but it is something that we need to keep in the back of our minds. If we break down below there, then it is likely that we could see a complete flush lower and potentially a “crypto winter.” I do not necessarily think that will happen, but it is something that is possible. The size of the candlestick is somewhat important, but I think short-term pullbacks should continue to see opportunities unless we see Bitcoin break down quite drastically. To the upside, breaking the 50 day EMA opens up the $150 level, and then possibly the $200 level after that.
