Solana Is Now Down -85% Since Its All-Time High In November 2021
On June 3, the price of Solana (SOL) fell, bringing its net paper losses to 85 %, seven months after peaking above $260.
After failing to rebound with conviction from 10-month lows, the SOL price plummeted by more than 6.5% intraday to $35.68.
The SOL/USD pair, which is now lying on a historically major support level, might see an upside retracement in June, with a target of $40-$45, up roughly 25% from today’s price.
Is a 60% price drop in Solana on the way?
However, a recovery is far from certain, and Solana suffers headwinds from trading in lockstep with Bitcoin (BTC), the world’s most valuable cryptocurrency by market capitalization, which often drives patterns in the top altcoins.
In particular, as of June 4, the weekly correlation coefficient between BTC and SOL was 0.92.
Furthermore, if Bitcoin goes further below its present psychological support line of $30,000, Solana is likely to suffer much greater losses than BTC.
Meanwhile, the Federal Reserve appears to be on a mission to raise interest rates and shrink its balance sheet. Riskier assets like Bitcoin have room to fall as a result of this aggressive stance, undermining Solana’s optimistic chances.
Breaking below SOL’s present support level of $35 increases the odds of a drop to the $18-25 region, which served as a solid support area in March-July 2021 and preceded a 1,200 percent price rally, as seen below.
This bearish scenario would put SOL almost 60% below today’s price.
DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.
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