Solana Price Alert: September May Lead to a Severe Decline

Current Market Situation

• Price and Position: Solana (SOL) is currently trading at $205, facing a critical juncture influenced by both on-chain metrics and technical analysis.

Profit-Taking Pressures

• Profit Levels: Over 90% of Solana's supply is in profit, historically leading to corrections of 8–23% when similar conditions were met earlier this summer. This indicates a potential for sellers to enter the market if momentum falters.

Exchange Flow Dynamics

• Exchange Balances: SOL balances on exchanges have risen above 32 million, a level not seen since before the August sell-off. Increased deposits often signal impending selling activity, suggesting traders may be looking to secure profits.

Technical Analysis

• Chart Patterns: SOL is currently within an ascending wedge pattern on the weekly chart, which typically indicates a potential downward breakout. Key support levels are identified at $195 and $182; a failure to hold these could lead to a drop towards $160. Conversely, a close above $217 could shift sentiment to bullish, targeting $240–$260.

September Scenarios

• Bullish Breakout: There is a 15% probability of a bullish breakout if SOL closes above $217, potentially driven by ETF optimism and institutional investments, with targets around $240–$260.
• Bearish Breakdown: A 25% probability exists for a bearish breakdown if the price falls below $195, with further declines possible to $160, erasing much of August's gains.
• Consolidation: The most likely scenario (60% probability) is for SOL to remain range-bound between $182 and $217, as market sentiment remains cautious, possibly delaying significant movement until October.

Historical Context and Outlook

• September Trends: Historically, Solana has seen gains in September since 2021, but current on-chain data suggests this year may deviate from that trend. Without a decisive push above $217, the market may lean towards consolidation or a correction before any significant upward movement occurs.

Disclaimer

• The information provided is for informational purposes only and does not constitute financial, investment, or trading advice. Always conduct your own research and consult with a licensed financial advisor before making investment decisions.