- Solana is testing multi-year lows, with significant liquidity still present between $175–$190.
- Technical patterns suggest a late-stage consolidation, possibly part of a broader basing phase.
- Traders are advised to prioritize risk management and wait for confirmed trend changes before entering positions.
Solana (SOL) is showing signs of intense market scrutiny as it revisits the lower bounds of a multi-year trading range. Analyst Scient highlighted that SOL is currently at range lows, testing support for the first time after rejecting from the highs.
Scient noted that range lows rarely break on the first attempt, suggesting that while the environment appears bearish, immediate deeper declines are not guaranteed.
Source: X
Liquidity is a key factor in this phase. Scient pointed out significant liquidity between $175 and $190, which could be tagged before any further downside.
This move would make sense even in a broader bearish environment, aligning with derivative positions such as $30 calls. The expectation is that SOL may rise temporarily to absorb liquidity before continuing any downward trajectory.
Also Read: Solana (SOL) Faces Brutal Test: $142 Target by January 15
Technical Patterns Point to Final Basing Phase
From a technical analysis point of view, it appears that SOL is in a late stage of consolidation.
On X, an analysis by analyst Elja points out that there is a cup and handle formation taking place in the month-long chart, which is commonly associated with a reversal or a base formation.
Source: X
This indicates that the drop is actually part of a larger basing process. The traders monitoring the neckline in the $SOL market are waiting for true market structure changes.
If there is a definite breakout above the downtrend, this may well come as a surprise, since most traders are concentrated on the possibilities of forming head-and-shoulders patterns.
If the market is in the phase of consolidation, this may open the way for the subsequent positive trend.
Solana Downtrend Lacks Bullish Confirmation
Analysts have always emphasized the need to trade disciplinarily when an environment of uncertainty exists.
A case of a cautious approach can be observed as long as SOL is in a downward trend that is not supported by the confirmation of a bullish momentum of SOL.
Market observers recommend that they remain on the fringes, capital protection, and wait until they see good technical patterns before putting their money into it.
Even bulls mostly on crypto understand that it is necessary to respect long-term trends and evident patterns in order to save money.
The current recommendation is not to jump into positions but to focus on time and quality setups, despite the possibility of purchasing at a higher level in the future.
Also Read: SOL Price Near Key Support as Institutional Adoption of Solana Accelerates
