Head and Shoulders Completed…Solana Downside Warning Issued

▲ Solana (SOL)/AI generated image ©

Market vigilance is rapidly increasing as Solana (SOL) forms a typical bearish reversal pattern, raising the possibility of an additional decline of up to 25%.

According to investment specialized media FX Empire on April 14 (local time), Solana is showing signs of a slowing uptrend by forming a head and shoulders pattern on its recent 3-day chart. The structure of a left shoulder in late February, a head around $100-$105 in mid-March, and a right shoulder around $90 in early April has been completed, establishing a typical bearish reversal pattern.

The critical support level for this pattern is the $78-$80 range, acting as the so-called neckline. Analysis suggests that if this range collapses, selling pressure could rapidly expand, accelerating the downtrend. The target price, calculated based on the pattern's height, is $56-$60, indicating an approximate 25% further downside potential from the current price.

On-chain indicators also support the downside risk. Based on the Market Value to Realized Value (MVRV) ratio, Solana is below its average line and in the -0.5 sigma zone, having entered a bearish conversion zone. This zone typically appears at the beginning of a downtrend as an intermediate point, and failure to hold support has historically led to further declines to the -1.0 sigma zone.

The -1.0 sigma zone is currently formed at approximately $66.6, suggesting a realistic further downside target if selling pressure persists. This range is also similar to the $60s target presented by technical patterns, acting as a factor that increases the reliability of the bearish scenario.

However, if the price recovers above $92, this head and shoulders pattern will be invalidated, and the bearish scenario will be discarded. The market assesses that since both the current technical structure and on-chain data point to weakness, the short-term outlook favors downward pressure rather than a rebound.

*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.*