Solana At A Crossroads: This Key Indicator Holds The Key To $175 Or $220

Reason to trust Strict editorial policy that focuses on accuracy, relevance, and impartiality Created by industry experts and meticulously reviewed The highest standards in reporting and publishing How Our News is Made Strict editorial policy that focuses on accuracy, relevance, and impartiality Ad discliamer Morbi pretium leo et nisl aliquam mollis. Quisque arcu lorem, ultricies quis pellentesque nec, ullamcorper eu odio. Solanais once again at a pivotal crossroads, with its price hovering around the 50-day EMA —a level that could dictate its next major move. A decisive break above $220 could ignite fresh bullish momentum, while failure to hold could open the door for a slide back toward $175. SOL Tests 50-Day EMA As Market Watches Closely

Lark Davis, a widely followed crypto analyst on X, recently notedthat Solana has returned to test its 50-day EMA. This moving averagehas historically provided both support and resistance for SOL, making the latest retest a key moment for traders watching the coin’s short-term direction. Related Reading Solana (SOL) Nosedives – Traders Fear More Pain Could Be Ahead 3 days ago

In addition, Davis highlighted signs of improving momentum on the indicators. The MACD histograms are curving upward, hinting at a potential shift in momentum from bearish to bullish, while the RSI is slowly rising, suggesting that buying pressure may be building. These developments signal that Solana is preparing for a recoveryphase if buyers step in with stronger conviction. Source: Chart from Lark Davis on X

Despite these encouraging signals, Davis noted that trading volumes remain muted. Low volumeoften raises concerns about the strength behind a move, as rallies without significant participation can fade quickly.  What To Watch For As Solana Builds Strength

Analyzing the potential outlook for Solana, Lark Davis highlighted two distinct, high-stakes scenarios based on how the asset interacts with the 50-day Exponential Moving Average (EMA). This EMA acts as a pivotal line, and the price’s reaction here will determine the direction of the short-term trend. Related Reading Solana Eyes Massive Breakout Amid $240 Retest, But Analyst Issues Crucial Market Warning 2 weeks ago

The first potential outcome is that if the price is decisively rejected at the 50-day EMA, known as a bearishretest, it would signal weakness and likely lead to a move downward. In this case, the analyst targets the $175 support level as the expected floor. While he qualifies shorting as “nasty business,” he suggests it could be done in this specific situation.

The second outcome, which is a bullishscenario, requires a strong display of conviction from buyers. This involves a successful and robust reclaim of the 50-day EMA, specifically confirmed by today’s daily candle closing above $210. To further solidify this bullish case, the price ideally needs to push beyond the subsequent resistance at the 20-day EMA, which sits near $220.

Given the immediate threat and the potential for a swift upside move, the analyst suggests a high-risk, high-reward play. Initiating a long position from the current price, near $209, with a tight stop-loss might be a sensible strategy to catch the bullish scenario and capitalize on the quick momentumif the price successfully reclaims the 50-day EMA. SOL trading at $208 on the 1D chart | Source: SOLUSDT on Tradingview.com Featured image from iStock, chart from Tradingview.com