With Solana (SOL) failing to reclaim a key resistance area, one market watcher suggested that the cryptocurrency is poised to retest November lows. However, other analysts predicted that the altcoin consolidation period could end soon.
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Solana refuses from key area
On Friday, Solana faced a nearly 4% correction after attempting to reclaim a key resistance zone for the second time this week. The cryptocurrency has been trading in the $120 to $145 price range since the correction in early November, hitting a local low three weeks ago.
Amid the rise of the crypto market star of the year, SOL has soared more than 13% since the beginning of the year, breaking a three-month downtrend and hitting a one-month high of $143.4 earlier this week.
After being rejected from the cap on Tuesday, the altcoin is now trying to build a foundation below the $140 level, which has faced strong resistance for the past three months.
Despite the sharp rally, market observer Crypto Batman predicted that SOL appears to be forming a bullish reversal pattern in the daily time frame, with the potential for a reversal towards the November lows.
In the X post, the analyst noted that the altcoin was rejected by a strong resistance area and claimed that a local top had formed. As a result, the next support area for the cryptocurrency will be around the $128-$130 area, where a bullish unfilled fair value gap (FVG) is located.
CryptoBatman also pointed out that Solana may be forming an inverted head-and-shoulders pattern since the Q4 correction. According to the chart, the cryptocurrency formed a left shoulder and head pattern during the pullback in November and December, with a neckline around $145.
Additionally, the recent rejection could indicate that a right shoulder is starting to form, with prices falling to late November lows before retesting the neckline of the pattern and potentially a breakout if formation is confirmed.
Has Sol woke up?
Market watcher King Arthur shared his bullish outlook on Solana, asserting that altcoins are “finally waking up.” He asserted, “We've been watching a long downturn for a while, but it's great to see SOL finally break out of that downward channel. This is a big first step, but let's get on with it.”
As he explained, breaking out of the $143 level is crucial for Solana's momentum as it opens the door to regaining the $152 level lost during the November 13 breakdown.
“If we can do that, we can look at $171.55 and say the uptrend is officially back on track,” he asserted. However, he cautioned that a decline below the $133 area suggests that prices are not ready for bullish continuation.
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Meanwhile, analyst Crypto Gel noted that Solana has failed to challenge the psychological barrier of $200 and has fallen below this level in the past few months. He suggested that recent performance is starting to resemble BNB's price action.
“It's starting to feel a bit like BNB. For what feels like an eternity, it goes sideways, and then there's a sudden expansion again. (…) We're waiting for the same result,” he concluded.
As of this writing, Solana is trading at $134.9, down 2.3% on a daily basis.
Featured image from Unsplash.com, chart from TradingView.com
