Solana (SOL) Elliott Wave Analysis: Eyeing Descending Channel Breakout

Solana (SOL) is showing signs of a potential bullish recovery after a prolonged corrective phase. The price has completed a significant multi-wave correction and is now forming higher lows, suggesting a possible uptrend. Using Elliott Wave Theory and Fibonacci retracement levels, this analysis evaluates the short-term and long-term outlook.

SOL Price Analysis

Solana has undergone a prolonged corrective structure labeled as a W-X-Y-Z pattern, which found support near $173.42, coinciding with the 1.0 Fibonacci retracement level. This level acted as a strong demand zone, triggering a price rebound.

The interaction with this area was a brief one, as the price quickly spiked up above $195 on Feb. 3 and proceeded to establish support. It managed to do so at $190 and we saw a slight upturn, leading to a high of $210.

Looking at the 4-hour chart we can see that a breakout from the descending channel structure has occurred which could signal a potential shift in momentum, suggesting that the recent bottom may mark the end of the correction.

Following the rebound, price action has attempted to establish an impulsive wave count, with wave (i) forming at approximately $206 and wave (ii) retracing into the $190 region before consolidating. The 0.618 Fibonacci retracement level at $216.90 remains a critical resistance, aligning with the previous structural rejection zones. A decisive close above this level could accelerate the rally toward $231.72 (0.5 Fibonacci retracement), and confirm the breakout.

Despite the bullish breakout attempt, momentum remains uncertain as RSI fluctuates in neutral territory, reflecting market indecision. If bulls fail to sustain buying pressure above $195.81 (0.786 Fibonacci retracement), the price could retest the $173.42 support zone, potentially delaying further upside continuation. However, as long as Solana maintains its recent higher low structure, the outlook remains bullish with an expectation of continued recovery.

SOL Price Prediction

The 1-hour chart provides a detailed Elliott Wave count suggesting that Solana is in the early stages of a five-wave impulsive structure. The projected move anticipates an extension toward $246.54 (0.382 Fibonacci level) if the current wave count remains intact. Wave (iii) appears to be unfolding, and if it successfully breaches $216.90, it could lead to a more aggressive push towards $231.72 and beyond.

Wave (ii) established a corrective retracement into the $190 zone, finding strong support near the 0.786 Fibonacci level ($195.81). This area has held firm, preventing a deeper retracement, which is a bullish sign for continuation. The next key milestone will be the completion of wave (iii), which, based on Fibonacci projections, could extend toward $246.54, followed by a brief consolidation in wave (iv) before a final rally into $264.87 (0.236 Fibonacci level) to complete wave (v).

Failure to maintain the higher low formation could disrupt the bullish outlook, leading to a deeper retracement toward the $173.42 demand zone. This would invalidate the current wave structure and suggest further consolidation before the next major trend emerges. However, as long as price remains above $195.81 and continues forming higher lows, the bullish scenario remains valid. RSI on the lower timeframe remains neutral, indicating that momentum could still accelerate with increased buyer volume. The market remains at a pivotal juncture, with further confirmation needed for a sustained breakout.

Key Levels to Watch

• Immediate Resistance: $216.90 (0.618 Fibonacci retracement)
• Key Resistance: $231.72 (0.5 Fibonacci retracement)
• Major Resistance: $246.54 (0.382 Fibonacci retracement)
• Immediate Support: $195.81 (0.786 Fibonacci retracement)
• Key Support: $173.42 (Major demand zone)
• Bullish Target: Above $264.87 (0.236 Fibonacci extension) if wave (v) extends
• Invalidation Zone: Below $173.42, signaling potential further downside