After hitting a one-month low, Solana (SOL) has bounced from a critical support zone and is attempting to reclaim a crucial psychological barrier before potentially resuming its bullish rally. However, some analysts suggested that the cryptocurrency could retest new lows if the market volatility persists.
On Thursday, Solana lost the $200 level as support after closing the day below this level for the first time in nearly a month. The cryptocurrency has been trading inside the $120-$220 price range since early February, finally breaking out of this range in mid-September.
However, this week’s pullbacks have sent most cryptocurrencies below crucial levels, with Bitcoin and Ethereum dropping to $108,000 and $3,800, respectively. Meanwhile, Solana has seen a 20% decline in the weekly timeframe, losing the $200 level.
According to the post, SOL has been trading within an ascending channel since April, bouncing between the upper and lower boundaries throughout this period.
Notably, SOL bounced from the recent lows on Friday Morning and is currently attempting to break above the $200 psychological barrier.
Nonetheless, the cryptocurrency must daily close above this key level and continue to hold it over the weekend to transform the pullback into a downside wick deviation in the weekly timeframe.
According to the market watcher, reclaiming and holding above that level would be the first bullish sign, which could potentially push Solana’s price toward $216–$220, near the 30-day MA.
As of this writing, SOL trades at $199, a 1.4% increase in the daily timeframe.
