Solana sold off sharply on Thursday following
the news of the Binance hack, with concerns about potential contagion across
the crypto ecosystem weighing on sentiment. The increase in liquidations
amplified the downside, with SOL especially vulnerable given its higher
volatility and speculative positioning.
Nevertheless, Solana eventually rebounded as
Binance pledged to cover customer losses and concerns gradually eased.
Improving sentiment around US-Iran negotiations also helped support risk
appetite.
Looking ahead, the macro backdrop remains
challenging amid inflation risks, growth concerns, expectations of further Fed
tightening and geopolitical uncertainty limiting a sustained recovery. Solana is
also sensitive to changes in overall crypto market sentiment, given its
higher-beta characteristics.
We will likely need a breakthrough in US-Iran
negotiations or more dovish Fed signals to change the current bearish trend. A
surprising Republican sweep in the US midterm elections could also provide support
through expectations of further fiscal expansion. A Democratic sweep, on the
other hand, could lead to more downside for SOL if negotiations with Iran fail
to progress or, worse, Trump decides to escalate the conflict.
SOLANA TECHNICAL ANALYSIS – DAILY TIMEFRAME
On the daily chart, we can see that Solanabroke through the key 97.00 support after the Binance hack and it’s
now approaching the major upward trendline. We can expect the buyers to lean on
the trendline, with a defined risk below it, to position for a rally into the
148.00 level. The sellers, on the other hand, will want to see the price
breaking lower to increase the bearish bets into the 75.00 handle next.
SOLANA TECHNICAL ANALYSIS – 4 HOUR TIMEFRAME
On the 4 hour chart, we have a downward
trendline defining the bearish structure. If we get a pullback into the
trendline, we can expect the sellers to lean on it, with a defined risk above
it, to target a break below the major upward trendline. The buyers, on the
other hand, will want to see the price breaking higher to pile in for a rally
into the 113.00 level next.
SOLANA TECHNICAL ANALYSIS – 1 HOUR TIMEFRAME
On the 1 hour chart, we
have a minor downward trendline defining the bearish momentum on this timeframe.
The sellers will likely lean on the trendline, with a defined risk above it, to
keep pushing into new lows. The buyers, on the other hand, will look for a
break higher to extend the pullback into the major downward trendline. The red
lines define the average daily rangefor today.
UPCOMING CATALYSTS
Today we have the US Job Openings data and the US midterm elections, although
we will get the first results early tomorrow. Tomorrow, we have the US ADP and
the US ISM Services PMI. On Thursday, we get the latest US Jobless Claims
figures. On Friday, we conclude the week with the US NFP report and the
University of Michigan Consumer sentiment survey.
This article was written by Giuseppe Dellamotta at investinglive.com.