After crashing from nearly $300 to under $100 in the first four months of this year, a decline Elliott Wave analysis warned us about in advance, Solana nearly doubled to $188 in late-May. Instead of going for $200, however, the bulls lost momentum and allowed the price to tumble back to roughly $150. Here, we’ll examine the structure of both this pullback and the preceding recovery, in order to get a sense of where the sixth biggest cryptocurrency is likely headed next.
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The 4-hour chart of Solana reveals a very clear five-wave impulse pattern to the upside from $95 to $188. We’ve labeled it (1)-(2)-(3)-(4)-(5), where two lower degrees of the trend can be recognized within wave (1) and the five sub-waves of (3) are also visible. According to the Elliott Wave theory, a three-wave correction follows every impulse. That’s what we think the current dip stands for.
It looks like another impulsive structure, marked 1-2-3-4-5, in what should be wave (a) of a simple (a)-(b)–(c) zigzag retracement. Waves (b) up and (c) down have yet to take place before the corrective phase of this cycle is over, probably somewhere near the 61.8% Fibonacci support level. In other words, Solana can be expected to drop to $130, before the bulls get another shot at $200.
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