Will Solana Fall Hard to $100 after Going Below Resistance of $200?

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As a seasoned analyst with years of market experience under my belt, I can’t help but feel a sense of deja vu looking at Solana’s current predicament. The crypto market has seen its fair share of rollercoaster rides, and this latest dip below the critical $200 support level is just another chapter in that narrative.

The price of Solana has fallen beneath the significant $200 threshold, causing some apprehension that it might further plummet to $100. This slide occurred after a general crypto market slump triggered by the latest Federal Open Market Committee (FOMC) gathering.

At the recent gathering, as anticipated, the Federal Reserve lowered interest rates by a quarter of a percent. Yet, uncertainty arose when Chairman Jerome Powell stated that there would be no further rate reductions until 2025. This announcement put additional strain on financial markets, particularly the cryptocurrency sector. (First-person perspective: As an analyst, I observed this development in the meeting where the Federal Reserve lowered interest rates, but the chairman’s statement about no more reductions until 2025 added uncertainty to the financial markets, especially affecting the cryptocurrency market.)

As a result of Bitcoin‘s decrease in value, there has been a significant fall in the prices of altcoins and meme coins overall. In this volatile market, Solana witnessed a steep 30% drop, moving from a high of around $263 to its current level hovering at approximately $183.

At present, Solana is being exchanged for approximately $190, representing a 7.18% decrease over the last day, which reinforces a bearish outlook. The Relative Strength Index (RSI) currently stands below 40, indicating weakness and possible oversold conditions. As the RSI inches towards 30, it might provoke additional selling pressure.

As a crypto investor, I’ve been closely watching Solana’s price movements. If the market downturn persists and bears maintain control, I foresee Solana’s price potentially dipping down to around $160. With continued bearish sentiment, there’s even a possibility it could slide further to $140 or potentially dip as low as $100. However, if the bulls manage to regroup and regain strength, Solana might recover and attempt to break back above the resistance level of $200.

According to Coinglass’s findings, the trading volume for Solana surged by 33%, reaching a whopping $18 billion. However, the open interest dropped by 16% to stand at $4.41 billion. This suggests that there was a significant increase in trading activity among traders who were readjusting their positions.

The information from liquidations indicates a blend of opinions among traders, as they hold both buying and selling positions. Moreover, the high volatility observed in Solana’s pricing, particularly during significant shifts, underscores the unpredictable nature of its derivatives market.

Over the past day, I’ve noticed a significant decrease in Solana’s Total Value Locked (TVL) based on DeFiLlama data, with the figure dropping from $11 billion to $7.93 billion, representing a 10% decline. This downward trend suggests increasing bearish sentiment and may cause apprehension for investors like myself who are keeping a close eye on the market.

As a researcher, I’m observing that the current selling pressure on Solana might cause its price to plummet towards the $100 mark if it persists. Yet, there’s hope for a recovery if resilient support levels can be maintained.

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2024-12-20 23:00