Solana (SOL), 21% Plunge Risk...Will a 356% Surge in Exchange Withdrawals Save It?

▲ Solana (SOL)

Solana (SOL) has reached a critical juncture amidst conflicting signals: a warning of a further 21% decline due to a double-top pattern and a surge in exchange withdrawals.

According to crypto media outlet BeInCrypto on May 14 (local time), Solana formed two peaks at $97.66 in late March and $98.35 on May 12. The double-top pattern was reinforced by a decrease in buying volume. If the neckline at $76.66 breaks, a 21% downside target will be activated.

Large purchase price zones stand firm on the downside path. Glassnode data shows that 13,734,525 SOL were bought in the $85.66 to $86.22 range, and 8,804,899 SOL were concentrated in the $88.49 to $89.07 range. For the double-top pattern to be completed, both support zones must be broken successively.

Exchange fund flows indicated a weakening of selling pressure. Solana's net outflow from exchanges increased from 501,807 SOL on May 2 to 2,286,298 SOL on May 13. In less than two weeks, withdrawal volume surged by 356%. The media analyzed that as investors moved Solana off exchanges, the amount of selling pressure that could enter the market decreased.

Technically, the 20-day Exponential Moving Average (EMA) at $89.54 and the 50-day line at $88.13 are the first lines of defense. If the daily candle closes below the 50-day line, the Fibonacci 61.8% retracement level at $84.96 and the maximum purchase price zone will be tested. If even this zone is breached, the Fibonacci 78.6% retracement level at $81.31 and the neckline at $76.66 are the next support levels.

If the neckline collapses, the downside target is $63.25, with a lower support level at $60.23. Conversely, a recovery to $93.25 would weaken the bearish outlook. For the double-top pattern to be completely invalidated, the daily candle must close above $98.37.

[Key Article Summary]

-Solana faces a risk of a further 21% decline if the $76.66 neckline breaks.

-Net exchange outflows surged by 356%, increasing from 501,807 SOL to 2,286,298 SOL.

-The double-top pattern will only be completely invalidated if the daily candle closes above $98.37.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*