Solana Price Dips Below $120, Faces Key Resistance at $116

Solana’s price action has taken a bearish turn, mirroring broader market weakness seen in assets like Bitcoin (BTC) and Ethereum (ETH). After failing to settle above the $125 resistance zone, SOL initiated a fresh decline that saw it breach several support levels. The price moved decisively below $125 and $122 before gaining bearish momentum under the $120 mark. This sell-off culminated in the formation of a low at $112, from which the price is now consolidating its losses.

This consolidation has resulted in a minor recovery toward the 23.6% Fibonacci retracement level of the downward move from the $128 swing high to the $112 low. However, the broader picture remains challenging for bulls. SOL is currently trading not only below the psychologically important $120 level but also beneath the 100-hourly simple moving average, a technical indicator often used to gauge short-term momentum. This positioning below both a key price level and a significant moving average underscores the prevailing selling pressure.

The immediate challenge for any potential Solana recovery is a clearly defined technical barrier. On the hourly chart of the SOL/USD pair, a key bearish trend line is forming with resistance precisely at the $116 level. This trend line represents the immediate ceiling for price action. A successful break and close above this $116 resistance is the first prerequisite for bulls to regain some control.

Should SOL manage to overcome this hurdle, the next major resistance awaits near the $120 level, which also coincides with the 50% Fib retracement level of the recent down move. The main resistance, however, is positioned at $122. A decisive close above this $122 zone could potentially set the stage for a more sustained increase, with subsequent targets at $125 and possibly $132. The technical analysis suggests that the $116-$122 band is the critical battleground that will determine whether the consolidation phase transitions into a meaningful recovery wave.

Conversely, if SOL fails to muster the strength to rise above the $116 resistance, the risk of another decline increases significantly. The initial support on the downside is situated near the $114 zone. The first major support, however, is the recent low at $112. A break and sustained close below this $112 level would signal a resumption of the bearish trend, likely sending the price toward the next significant support zone at $105.

A breach of the $105 support would be a strongly negative development, potentially opening the door for a decline toward the $102 level in the near term. The defense of these support levels—$112 and $105—is therefore paramount for bulls aiming to prevent a deeper correction. The technical indicators currently align with this cautious outlook. The hourly Moving Average Convergence Divergence (MACD) for SOL/USD, while losing some pace, remains in bearish territory. Furthermore, the hourly Relative Strength Index (RSI) is below the neutral 50 level, indicating that selling momentum, though potentially slowing, has not yet reversed.