SOL: 5th straight day of correction after an exponential rally from July lows 

A Healthy Correction

Solana (SOL) exploded from July lows of 22.10 to reach an astounding all-time high of 216.00 last week – a slight overshoot from 200.00. SOL has risen 500+% in less than 2 months, and is now due for a major pullback which is normal after explosive moves like this occur. 

Today will be the fifth straight day in the red for SOL, if it does indeed close in negative territory at the end of the day. It is currently almost -30% from all-time highs of 216.00, as it falls below the 10-day moving average (pink line), which is also coincidentally the 23.60% Fibonacci retracement level. It is noteworthy to see that for each pullback day, the trading volume for SOL keeps on falling slowly as well, which is usually a healthy sign for corrections. The MACD also looks like it could cross down, which suggests a consolidation for SOL in the near future. 

Should I sell now? 

If you have a position in SOL, with a low average price, now would be a good time to take partial profits. Maybe 25% to 50% of your position, just to lock in some profits after a big move. Take care to sell only a PART, and not everything, as there are no major red flags for SOL at the moment. The upward trend is still intact, along with volume contraction. There is no reason to worry – yet. 

On the other hand, if you do not have a position in SOL, the coming days/weeks would be a good time to watch closely for possible entry opportunities. In my opinion, the most realistic situation for SOL is that it could create a proper base before continuing its rally to new highs. 

Key Areas to Observe

Below are possible key support levels for SOL in the near future. Watch how the price reacts at these levels, to see if there are any possible buy opportunities. Ideally, wait for a green candle with relatively good volume, or a sign of a rebound at these levels, before placing a buy order. 

However, SOL should not break down below Support Level 4 at 100.00, as a correction this deep could mean the end of the uptrend for SOL.