- Solana price jumped 7% intraday on Tuesday on the back of big brother Bitcoin scaling higher.
- SOL has bulls under pressure as the sentiment is turning quickly with Bitcoin price going nowhere.
- As profit-taking gets underway, a breach of the supportive trend line in this rally could have bulls on the ropes with a 25% nosedive move.
Solana (SOL) was nearing one of its best-performing days of the year on Tuesday as the leading cryptocurrency, Bitcoin, was dragging the whole industry to the upside. With Bitcoin bulls being unleashed, altcoins could spin off the favourable tailwind and trade higher as well. Unfortunately, plenty of profit got erased in the last hours of the trading session from Tuesday, making it a less productive day than it could have been. The risk of more profit-taking to come is front and center as bulls are getting squeezed.
Solana price set to challenge the low of March
Solana price has printed some solid gains these past few days on the back of the Fed and US Treasury stepping up its game and containing the risk of a US bank defaulting. With the dust settling now, plenty of profit-taking is underway in the price action. Bulls are getting squeezed against a key supportive trend line, and it could spell mayhem if it breaks.
SOL is thus at risk of a sharp decline with only one level to mention that could halt or slow down the falling knife. That level is $18.66 and bears around a 12% loss. In case big brother Bitcoin starts to sell off sharply as well, expect to see a similar acceleration in SOL with price action quickly residing near $16 and with a 25% loss.
SOL/USD 4H-chart
A bear trap would be ideal to get price action in SOL shooting through that red descending trend line and start to attack that heavy level near $23. At that area both the 55-day and the 200-day Simple Moving Averages (SMAs) are nearby with the monthly pivot in the middle. If bulls can trash that area and plant a bullish flag, $26 with a 25% gain is bankable.