Solana (SOL) Price Prediction: Technical Indicators Suggest 16% Crash Despite Social Media Optimism Reaching Historic Highs

Like its peer XRP, Solana (SOL), the sixth-largest digital asset, is facing a “make it or break it” moment as technical indicators suggest a potential price crash of 16%, even as social media optimism around the asset reaches historic highs.

Like its peer XRP, Solana (SOL), the sixth-largest digital asset, is facing a “make it or break it” moment as technical indicators suggest a potential price crash of 16%, even as social media optimism reaches historic highs.

Analyst Ali Martinez has identified $125 as the most important support level for SOL, with a potential breakdown paving the way for further declines and a retest of $105 support in the near future.

$125 Support Level

The chart shared by Ali Martinez showed an ascending wedge pattern that could result in a bearish breakdown, signaling bearish implications.

$125 is the most important support level for #Solana $SOL! pic.twitter.com/mY4MUxMcyL

– Ali (@ali_chart) August 10, 2023

SOL recently broke through the lower trendline of this formation, and is now retesting the breakdown level. If SOL fails to claim the $145 region convincingly, it could confirm the bearish scenario and trigger a deeper sell-off.

Another major resistance is the 20-day Exponential Moving Average (EMA) at $136. The altcoin needs to confirm this as support before the next leg up.

The immediate support stands at $125, which is a key level for bulls to defend. However, failure to hold above this level could see SOL plummet toward $105 and even $58 in a worst-case scenario, as suggested by Martinez’s extended downside target.

Conversely, if SOL manages to reclaim $145 and push above $160, it could invalidate the bearish breakdown and pave the ground for a recovery toward $200 and beyond.

According to CoinMarketCap data, SOL is down 5.47% in the past 24 hours, trading at $130.75 at the time of writing, with a daily low of $130.46.

The Relative Strength Index (RSI) is now around 44.60, indicating that SOL is still in neutral territory but is tilting toward bearish momentum.

Moreover, Bollinger Bands (BB) show that the price is testing the middle band ($130) as support which could mean further downside pressure to the lower Band ($118) unless a reversal occurs soon.

Social Sentiment vs. Market Reality

Despite the negative technical signals, Solana’s social sentiment is at an all-time high.

According to Santiment, institutional interest, influencer engagement, and technological advancements have fueled a wave of optimism across social media platforms.

With major entities like GameStop integrating Bitcoin and BlackRock launching tokenized treasury funds on Solana, SOL has garnered an overwhelming 18:1 ratio of positive versus negative commentary online.

Historically, extreme social optimism has often preceded market corrections, as excessive bullishness can lead to overleveraged positions and profit-taking by early investors.

Just a month ago, Solana’s sentiment was at its lowest point in a year, following the collapse of the meme coin frenzy.