Solana and Ethereum Test Key Support Amid Crypto Decline

Market Outlook: Will a Major Crash Occur?

Will the growing bearish influence in the crypto market result in a major crash for top altcoins like Ethereum and Solana? Let’s explore the latest price action analysis for SOL and ETH to identify potential reversal spots and downside risks.

Solana Crashes Under $170

In the daily chart, Solana’s price action indicates a bullish failure to maintain dominance above the $180 mark. This has resulted in a three-day crash, accounting for nearly a 10% drop, characterized by an evening star formation at the $180 level.

Currently, Solana is testing a crucial support level near $164, trading at approximately $165.69. The sudden surge in selling pressure has led to a bearish crossover in the MACD and signal lines.

If the bearish trend continues below the $164 support level, two dynamic average lines—the 50-day and 200-day EMA—could serve as reversal spots, positioned at $156 and $145 respectively.

Ethereum’s Critical Local Support at Risk

Following a recent falling wedge breakout rally, Ethereum’s higher low formation continues despite a significant market crash that resulted in a 5.29% drop in ETH in a single day. The uptrend is still in play, although ETH struggles to surpass the $2,730 resistance level and has broken below the 50-day EMA.

Currently, ETH is facing challenges in obtaining support from a local trendline, with the 23.60% Fibonacci level positioned at $2,472. The intraday candle showcases a Doji formation as ETH trades at around $2,505.

This Doji candle suggests an increased probability of a Morning Star reversal to continue the bullish trend. However, the bearish crossover in the MACD and signal lines warns of potential negative continuation.

Using Fibonacci retracement tools, if ETH breaks the $2,730 resistance and crosses above the 200-day EMA, it could challenge the 50% Fibonacci level near the psychological mark of $3,000. Conversely, a breakdown below the local support trendline would put the $2,225 and $2,160 support levels at risk.