Solana (SOL) Eyes Key Demand Zone Amid Bearish Momentum

• Solana nears a key demand zone at $155-$167, where past buy-side interest triggered bullish reversals.
• A break below the demand zone could extend losses, while a rebound may target resistance near $226-$230.
• Bearish momentum persists as lower highs and liquidity sweeps shape price action, keeping SOL’s trend uncertain.

Solana (SOL) is facing selling pressure after a sharp rejection from recent highs near $300. The price is in a downtrend, breaking multiple support levels. Currently, SOL hovers near $204.13, approaching a crucial demand zone. This level has historically attracted strong buy-side interest. If the price holds within this region, a potential reversal could follow. However, a failure to sustain support may trigger further declines.

Key Levels and Market Structure

Crypto analyst Crypto Chase highlights a critical liquidity zone at $167.71. This marks a potential area where buyers could step in. The broader monthly demand zone spans from $155 to $167. Historically, this region has seen strong price reactions. Besides, past price action suggests that demand in this zone often triggers bullish reversals.

Moreover, recent price movements confirm the bearish structure. SOL was rejected from the $250-$230 range, forming lower highs and lower lows. This signals persistent bearish momentum. Additionally, a bearish Fair Value Gap (FVG) has formed around $225, indicating a potential price target if a rebound occurs.

Potential Scenarios for SOL Price

If SOL revisits the demand zone, a liquidity sweep could follow. This would allow for a stronger move upward if buyers step in. Consequently, a recovery toward the $226-$230 range remains possible. However, resistance lies in this zone, making it a critical test for bullish strength.

Conversely, failure to hold above the demand zone could extend losses. In this case, lower levels may come into play. The overall structure remains bearish unless key resistance levels break. Hence, traders should monitor price action closely.

Technical Outlook 

SOL remains in a downtrend, but a potential demand zone test could change the outlook. Market participants should prepare for both bullish and bearish scenarios. Moreover, historical reactions suggest strong buying interest in the current price range. However, without a confirmed trend reversal, downside risks persist.

Additionally, liquidity grabs and supply-demand imbalances will play a crucial role in upcoming price movements. As always, traders should focus on key levels and market structure before making decisions. Consequently, the coming days will be pivotal for SOL’s trajectory.