Solana has broken free from its previous corrective pattern
Throughout the year, the SOL price has been steadily growing within an ascending parallel channel. The resistance and support trend lines of this channel have been tested multiple times to confirm their strength.
In November, the asset broke through the resistance line of the channel and experienced an accelerated growth rate. This resulted in a new yearly high of $79.50 on December 16. Consequently, the price has increased by 865% since the beginning of the year.
Since November, the coin’s growth has been parabolic, showing no clear patterns.
Source: TradingView
The RSI momentum indicator is currently above the neutral level of 50 but is exhibiting signs of weakness through bearish divergence (green).
What experts are saying
Cryptocurrency trader @CryptoPoseidonn believes the market is nearing its top. He mentioned that he is prepared to sell but would like to wait for the 4-hour trend breakout. “The trigger will be an arrow if we get one”:
4-hour chart SOL/USDT. Source: X
CryptoBusy is closely monitoring the price struggle around the $78 level. He suggests observing the price action in that area before making any trading decisions.
“It still needs one big push to move the price above $78.
If it consolidates above this level, then $90 and then $107 will inevitably come into play.
But the market is still in a state of anticipation. Patience, guys.”
SOL forecast: where is the local peak?
The most probable scenario according to Elliott wave analysis suggests that SOL is currently in the third wave of a five-wave upward movement. The third wave is extended and is 2.61 times longer than the first wave. Therefore, it’s possible that the peak has already been reached.
This is supported by the daily RSI, which has formed bearish divergence, and the appearance of two upper wicks (red icons) on the December chart.
If this scenario holds true, the price of SOL could correct by 25% and reach the 0.382 Fibonacci retracement level at $55.60. Afterward, the fifth wave could propel the price to a new annual high.
Source: TradingView
Despite this bearish short-term outlook, a SOL closing above $73 would indicate that the fifth wave will continue. In that case, the token could potentially reach the next resistance level at $95, representing a 25% increase.
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