Solana (SOL) price analysis: Get ready for a big move after the hack

• Updated

Solana may witness a sharp move in the near term

Solana (SOL) price analysis                                 
Up to 8,000 wallets on the Solana ecosystem have been affected by a multimillion-dollar exploit – Photo: Shutterstock
                                

Contents

The Solana ecosystem witnessed a multimillion-dollar wallet exploit on 3 August, which has affected approximately 8,000 wallets. However, this has not caused colossal damage to SOL’s price and the bulls are attempting to arrest the decline as of 4 August 2022.

According to an investigation by developers, ecosystem teams and security auditors, the hack was related to the Slope mobile wallet application. Solana said in an official statement that affected addresses appear to have been “created, imported, or used in Slope mobile wallet applications” at one point.

Even after the hack, Sam Bankman-Fried, CEO of crypto exchange FTX, remains bullish and told Fortune that Solana was the most “underrated token right now… at least as of a month ago.” 

“I think it had a lot of bad PR over a short period of time. I think it sort of deserved that, to be clear: Technologically, it had a lot of shit to work through. But I think it has already worked through two-thirds of that. I think it will get through the other third,” Bankman-Fried added.

Solana seems to be on the institutional investor’s radar with year-to-date inflows of $114 million, according to CoinShares data.

Will investors retain their bullish view after the hack? Could SOL go up? Read the SOL price analysis to find out what the charts suggest.

Solana weekly price analysis
Solana weekly price analysis chart – Credit: Currency.com


Solana technical analysis: Weekly chart

SOL’s price has been in a strong downtrend for the past several months. The bulls attempted to stall the decline near $25 and start a relief rally, but the shallow recovery suggests that demand dries up at higher levels.

The bears will now attempt to sink the price back toward the crucial support at $25. If the price rebounds off this level, the SOL/USD pair could remain range-bound for a few days.

The bears will have to sink the price below $25 to signal the start of the next leg of the downtrend. The pair could then decline to $20.

On the contrary, if the price turns up from the current level, the buyers will try to push the pair to the 23.6% Fibonacci retracement level of $55.69. If this level is conquered, the rally could extend to the 38.2% retracement level of $71.21. The bears are expected to mount a strong defence at this level.

Solana daily price analysis chart
Solana daily price analysis chart – Credit: Currency.com


Solana technical analysis: Daily chart

SOL’s price has formed a symmetrical triangle pattern, which usually acts as a continuation set-up but sometimes may behave as a reversal formation. In a symmetrical triangle, traders buy the dips to the support line and sell near the resistance line.

The Relative Strength Index (RSI) is just below the midpoint, which does not give a clear advantage either to the bulls or the bears.

If the price breaks below the support line, it will suggest that the uncertainty has resolved in favour of the sellers. That could result in a decline to $25 and later to the pattern target of $18.

Alternatively, if the price rebounds off the support line, it will suggest demand at lower levels. The bulls will then attempt to push the price above the triangle. If they succeed, the pair could rally to its target objective of $62.

Solana: Buy or sell at current levels?

Solana is trading inside a symmetrical triangle pattern. Solana’s price analysis suggests that the next trending move could begin after the price breaks above or below the triangle. A break below the triangle could sink the pair to $18, while a break above the triangle could open the doors for a possible rally to $62.

The views and opinions expressed in the article are those of the author and do not constitute trading advice. Trading and investing involve substantial risks and you should do your own research or contact your financial adviser before arriving at a decision. 

Further reading

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