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- Solana’s recent recovery faces resistance, with technical indicators signaling a bearish short-term outlook and potential for a rebound.
- Despite a 4.25% daily gain, lower trading volume and supply constraints could limit Solana’s ability to reach $250 in the short term.
Solana (SOL) has recovered, regaining the $200 mark after a period of volatility in the crypto market. As of the time of writing, SOL was trading at $204.56, reflecting a marginal increase over the past day. While this positive movement marks a recovery from recent dips, the key question remains: Can Solana continue its momentum and push toward $250 this week?
However, trading volume has decreased, recording a drop of 35.24%, at $9.37 billion.
This reduction in trade activity may suggest lower market participation despite the overall positive price movement. Solana’s circulating supply is 487.07 million SOL out of 593.4 million, which could indicate future supply-side constraints impacting the market.
The price for Solana shows an upward trend, with the token’s price climbing from below $200 to over $210 by midday. This surge reflected renewed optimism in the market, although the volatility built into cryptocurrency trading continues to present risks for short-term movements.
SOL’s Bullish Performance in January
As noted in our earlier post, Solana hit an all-time high of $293.31 on January 19, 2025. However, it has since experienced a nearly 30% dip, with its price retreating from that peak. The broader crypto market faced a major correction on February 3, following President Donald Trump’s tariffs on Canada and Mexico. This move led to a temporary pullback across the crypto market, with many assets, including Solana, taking a hit.
Nevertheless, According to the CNF report, the market appears to be rebounding. Bitcoin (BTC) briefly reclaimed the $100,000 level, while other crypto assets, including Solana, have responded positively to Trump’s decision to pause the tariffs for 30 days.
Price Forecast: Can SOL Reach $250?
According to data from CoinCodex, Solana is expected to rise to around $234, a 13.39% increase from its current levels. However, the firm does not predict Solana will reach $250 immediately. The forecast suggests a potential dip to $215 in March, pointing out that Solana may face resistance before it can reach new highs.
Source: CoinCodex
Additionally, the total liquidations chart for Solana shows spikes in both long and short liquidations. Sharp price increases have been followed by surges in short liquidations, indicating a short squeeze.
Adding to this sentiment, Solana’s technical indicators suggest a bearish short-term outlook. The MACD (Moving Average Convergence Divergence) shows a bearish trend, with the MACD line positioned below the signal line and the histogram displaying red bars. This indicates growing selling pressure, possibly pushing prices lower.
Source: TradingView
Additionally, the RSI (Relative Strength Index) stands at 42.11, signaling that Solana is slightly oversold but not yet at extreme levels. Despite the bearish outlook, a rebound is possible if Solana breaks through key resistance levels.
