Solana (SOL) Price Drops by Over 14% in Four Days, Testing Key Support Zones

Solana (SOL) has been on a notable decline over the past few days, erasing gains that pushed it close to its all-time high earlier this month.

Solana (CRYPTO: SOL) price has declined over the past few days, erasing gains that pushed it close to its all-time high earlier this month.

After peaking at $263, SOL price has fallen by over 14% in just four days, with today’s session also marking a further 3.26% drop.

Currently trading at $226.55, Solana hit an intraday high of $239.91 before retreating to a low of $221.57. The pullback is testing key support zones as selling pressure intensifies, reflecting both market-wide profit-taking and cooling sentiment following its meteoric rise.

Solana price now faces strong resistance at the Fibonacci retracement level of 23.6% at $238, while further upside could be capped by the 14-day moving average at $242. On the downside, support is seen at the 38.2% Fib level at $222 and the 50-day moving average at $217.

Solana price is seen as overbought on the Relative Strength Index (RSI) at 76. A reading above 70 on the RSI generally indicates that an asset is overbought and could be due for a pullback. However, Solana's RSI has remained elevated for several weeks now, suggesting that the current price decline could be part of a larger adjustment rather than a sustained downtrend.

Investors are being more cautious in the broader market, evident in Solana’s price adjustment from its recent highs. Despite this, SOL continues to be one of the most actively traded and talked about digital currencies due to its popularity in decentralized finance (DeFi) and NFTs.

The significant drop in Solana’s price can mostly be linked to investors selling after its remarkable surge earlier this month. However, Solana’s fundamentals are still solid, supported by its capability to handle transactions quickly and its strong developer community.

Solana price outlook?

Staying above $225 could lead to a recovery, possibly reaching $248 or higher. However, failure to maintain key support levels could see SOL revisiting the $200 mark in the near term.