Bearish Clouds Hover Over Solana (SOL) Price Rally—Will it Plunge Below $200?

The crypto markets are gearing up with popular altcoins printing massive gains in the past few days. With XRP & ADA prices rising above $1 after a long time frame, the momentum appears to have shifted in favour of bulls. Meanwhile, Solana, which demonstrated monstrous moves in the recent past, is failing to gain trader’s attention as the price is slipping from its November highs. 

Solana surged heavily, entered the top 5 cryptos and became the 4th largest crypto with a market cap of over $120 billion in a short while. With this, the bears intensified their action, causing a notable pullback in the SOL price, which dropped by nearly 20%. After this move, the token also faced a drop in its social volume, specifically the sentiments. The number of mentions dropped drastically, suggesting the traders are no longer interested in the token. 

With this, will the demand for the token also drop as the technicals have also turned in favour of the bears? If yes, is the SOL price heading back to $200?

The token again failed to breach through the upper resistance of the rising parallel channel that it has held since the start of the year. Previously, it has resulted in a massive pullback, which raises the possibility of a similar price action as the technicals are also mirroring the previous pattern. The MACD was bullish until the SOL price surged above $200 in Q1 2024 but soon after that, the buying pressure faded, followed by a bearish crossover of the MACD & signal line. 

The weekly chart of SOL price suggests the buying pressure has dropped in the past couple of weeks, which has kept the price consolidated. Moreover, the levels are heading for a bearish crossover. Additionally, the drowning RSI validated the bearish claim, which suggests the price could be heading below $200 if the bulls continue to remain passive. However, the selling volume remains lower compared to the buying, which suggests the bearish strength may be lower than that of the bulls. 

Therefore, the Solana price continues to remain under bearish pressure, carrying the possibility of a massive pullback. However, if the bulls fail to defend the support at $200, the token may drop towards the pivotal support at $185, which was one of the important resistances to achieve previously.