The traders who experienced unrealized losses owing to the FTX collapse were charged up by the most recent Solana price rally. Since the FTX-related liquidity problem in November, the price of the Ethereum competitor has been steadily declining.
Although the cryptocurrency is now in a bullish overall trend, it is uncertain whether a further surge will occur soon. Bitcoin has finally crossed the significant $17k mark, sending green waves across the market.
Returning to Solana, the coin has shown a very exceptional start to the year as the network’s native cryptocurrency SOL had a significant rally over the past few days. According to the expert who correctly predicted the bottom of Bitcoin’s bear market in 2018, Solana may be preparing for a big retracement. According to analyst Smart Contracter, Solana’s excellent start to the year has probably come to an end.
“Over 112% move from the lows on SOL in a clear V reversal, five-wave impulsive move. One of the clearest I can see across the board, actually. Over the coming weeks, I’d anticipate an ABC correcting that whole run, probably between 25%-35%, but it will likely be a dip to buy.”
The Elliott Wave theory, a technical analysis used by Smart Contracter, seeks to forecast future price movement by observing crowd psychology, which frequently manifests in waves. The theory states that a bullish asset often corrects (ABC wave) following a five-wave advance.
According to the chart of Smart Contracter, at the 0.618 Fibonacci level, SOL is expected to decline below $12. At the time of writing, Solana is trading at $16 and is down by more than 5 percent.
Source: https://coinpedia.org/altcoin/solanas-excellent-start-of-the-year-is-coming-to-an-end-sol-price-might-drop-to-12-soon/