Metaplanet Takes the MicroStrategy Approach, SOL Nears Important Support Level

Daily Technical Strategy

Mark L. Newton, CMT

Head of Technical Strategy

Solana has now pulled back to what should represent an important area of near-term support for this recent weakness. $SOL lies right near 4/5 lows which also lies right at an area of support drawn from the bottom made back on 3/20. Given that two prior minor lows happened near this area, it can add to the likelihood of being a significant area to pay attention to. However, interestingly enough, $SOL daily pattern looks nearly identical to the formation shown by $NVDA on its own path through the month of March into April, with initial peaks in March that were tested successfully with a lower high in late March before pulling back to test the prior lows in early March. Specifically, when projecting forward in NVDA's pattern about a week, one can make out nearly the exact same pattern for Solana. In NVDA's case, the retest of lows failed to hold and the stock went lower this week. Applying this same possibility to SOL, any breach of $168 would be thought to decline to $160-$162 which looks formidable as support and should not represent anything more than just minor near-term weakness in its larger pattern. Thereafter, i expect a push back higher in $SOL into late April into May, where i expect this to make new all-time highs. Overall, despite many viewing this pattern as being bearish, i feel that the entire consolidation since mid-March merely represents a choppy, overlapping corrective pattern which should prove short-lived and buyable within the next couple weeks on any further weakness. The ability to make a weekly close back over $185 would signify the first real sign of strength which could take SOL back to new highs.