What to expect from Solana after the recent 40% crash

Solana has taken a heavy hit since its May high, dropping roughly 40% while Bitcoin is down about 30% over the same period. The move has been fast and brutal, which is typical for crypto bear phases: sharp declines followed by slower, choppy bounces. The big question now is whether Solana is close to a meaningful bottom or if more downside is still ahead.

Where Solana stands after the crash

From the 2022 low, Solana has completed a strong multi-month rally, but the recent sell-off has dragged price back into a key support zone. The market has now reached the 50% Fibonacci retracement level of that entire move, around $62. This is not just a random line on the chart – it’s a major level where traders often look for reactions and potential reversals.

Earlier in the year, Solana bounced from what was essentially “the middle of nowhere” on the chart, which made that rally structurally weak. This time, price has finally tagged a proper Fibonacci support area, which makes this level much more important for the medium-term trend.

The two main scenarios for Solana

The current structure can be interpreted in two main ways. Both are technically valid, but they don’t have the same probability.

Scenario 1: A deeper downtrend is still in play (preferred)

In the more likely scenario, Solana is still in a larger downtrend, working through a multi-leg decline. In this view, the market is in a strong third wave to the downside, with a fourth-wave bounce and a final fifth wave lower still to come.

Under this scenario:

- The overall pressure remains down as long as Solana trades below the last major swing high near $100.
- Any bounce from current levels is treated as a corrective move (a temporary rally within a broader downtrend) unless proven otherwise by the structure of the price action.

Scenario 2: A fourth-wave pullback before one more big leg up

The alternative, less likely scenario is that Solana is in a larger fourth-wave pullback within an ongoing bull structure. In that case, the move from the 2022 low would be seen as a three-wave advance so far, followed by a three-wave correction, with a fifth and final wave higher still to come.

For this scenario to remain credible, the current pullback should not go much deeper than the 50% retracement level around $62. A sustained break below that area would make this bullish interpretation significantly less likely, even if it doesn’t technically invalidate it.

Why the $62 level is so critical

The $62 zone is a major Fibonacci level that has been on the chart for a long time as a likely support area. In the bullish fourth-wave scenario, this is roughly where the pullback “should” stop. That’s why this level is so important:

- Holding above $62 keeps the door open for a larger bullish continuation later on.
- Losing $62 convincingly would strongly favor the deeper-downtrend scenario.

Because the market has now reached this level, what happens next around $62 will heavily influence which scenario takes the lead.

Key resistance zones to watch

Even in a downtrend, markets don’t move in a straight line. Bounces are normal, and Solana has several important resistance zones overhead that traders should keep an eye on.

Main resistance for the coming weeks

The primary resistance area for the medium term is between about $73.18 and $89.40. This zone is based on standard retracement levels of the last major decline. As long as Solana remains below this band, the broader bias is bearish.

Within that range, the last major swing high around $100 is the key line in the sand. A break above $100 would be a strong signal that the current downtrend is likely over and that a more lasting low has formed.

First local resistance on lower time frames

On the shorter-term chart, there are a few micro resistance levels that matter for traders watching intraday or daily moves:

- Initial resistance: roughly $64–$70.61 – this is the first small barrier that price is currently testing.
- Next resistance: $72.57 – this is especially important because it’s the 50% retracement of the last short-term decline.

A decisive move above $72.57 would suggest that the immediate third wave down has likely finished and that Solana has entered a larger fourth-wave bounce. That would not automatically mean the bear phase is over, but it would signal that at least a more meaningful short- to mid-term low is in place.

Major support levels below the current price

If $62 fails to hold, there are a few notable downside targets where the market might try to stabilize:

- $48.78 – next strong support level and a logical area for buyers to step in.
- $43.22 – a minor support zone, less important than the others.
- $31 – a major lower support level, which would come into focus if the sell-off deepens significantly.

These levels are useful for planning entries, exits, or risk management if the current downtrend continues.

What would a real bottom look like?

Price levels alone are not enough to confirm a lasting bottom. The structure of the move off the low matters just as much. A strong bottom is typically signaled by a clear five-wave advance from support, followed by a corrective pullback that holds above the low.

For Solana, key bottoming signals would include:

- A visible five-wave move up from around $62 (or any lower support level if $62 breaks).
- A break above roughly $89, which would show that the move up is more than just a shallow bounce.
- Ideally, a later break above $100 to confirm a major trend reversal.

Until those signals appear, any rally is more likely to be a temporary correction within a larger downtrend.

Short-term outlook: pressure still down

In the very short term, Solana is seeing a small bounce from support, but this move doesn’t yet look like the start of a new major uptrend. It’s more likely part of a corrective phase within the ongoing decline.

As long as price remains below the key resistance zones – especially $72.57 in the short term and $73–$89 in the medium term – the path of least resistance is still down. Another low, or even multiple new lows, remains a real possibility before a durable bottom is in.

How traders and investors can approach this move

For active traders, the current environment is all about levels and structure. The $62 support, the $72.57 short-term resistance, and the $73–$89 medium-term resistance band are the main areas to watch for reactions and potential setups. Many will wait for a clear five-wave structure up and a break of key resistance before treating any low as significant.

Longer-term investors may see this drawdown as part of the broader volatility that comes with crypto cycles. Some may choose to dollar-cost average into weakness, especially if they believe in Solana’s long-term fundamentals, similar to how some investors approach broader market crashes, as discussed in this guide on buying the crypto crash and DCA strategies.

For a deeper look at what triggered Solana’s recent sharp sell-off and how on-chain and market data explain the move, you may also find it useful to read this breakdown of why Solana crashed and what the data really says.

For now, the message from the chart is clear: Solana is at a critical support level, but the downtrend is still in control until proven otherwise by price action.