Solana’s Crucial Support Zone Under Threat: Is a Price Plunge Imminent for SOL?

The Recent Performance of SOL Price

The cryptocurrency market, after experiencing significant gains earlier this month, has retraced its steps. Notably, Solana (SOL) had recorded its best institutional inflow since March 2022 last week, but the price plummeted by over 9% in response.

SOL Price Movement in September

Throughout September, SOL price remained relatively stable, trading sideways. However, later in the month, the coin gained momentum, breaking through several resistance levels. Since then, the price has been on a bearish trend, signaling a bearish sentiment prevailing in the market.

Current State and Technical Indicators

Presently, SOL is teetering near a crucial support zone at $21.15. Despite testing this level multiple times today, the bulls have managed to keep the price above it. The Relative Strength Index (RSI) has exhibited significant volatility this month, with averages initially above the midpoint for over two weeks. However, a subsequent dip in price pushed the averages below the halfway mark, indicating a weakening price action. Currently, the averages are nearing the oversold range, suggesting a feeble market sentiment.

Future Price Scenarios

If there’s a trend reversal and the market gains bullish momentum, SOL could challenge the resistance level at $22.43. Further strengthening by the bulls might lead to a breakout, propelling the price towards the upper resistance of $23.33 in the upcoming days.

Conversely, if bears continue to dominate, SOL’s momentum could wane, and it might continue trading within the descending channel. If the bulls fail to sustain the price above the crucial support zone of $21.15, the market might succumb to bearish pressure, breaking down the channel. This scenario could result in the price testing its lower support zone at $20.45 soon.

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