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As the weekend approaches, altcoins are showing more signs of weakness, and the latest macro data has been negative. There was a lot of talk about sticky inflation at Davos this week, and the global fight against inflation could pressure risk markets in the first half of this year. BTC, having remained below a significant threshold for a long time, is contributing to the weakness in altcoins.
Solana (SOL)
SOL Coin price has fallen back below $100 but is maintaining its rising trend line. The key region is $97.6, with SOL Coin closing above it. Sales above $100 are fed by the general market sentiment, but the outlook is not so negative despite the recent drop. However, if the rising trend line is lost, we could see a new bottom between $87.6 and $58. In the opposite scenario, $111 is targeted.
Investors are nervous since BTC broke below the rising parallel channel on January 12, but extreme sell-offs have not yet started. This indicates that the excitement for ETFs has significantly faded but still keeps the market alive.
Since Solana is positioned to positively diverge in the market, it could quickly recover on good news. Therefore, those waiting to short-sell should be wary of unpleasant surprises.
Avalanche (AVAX)
Avalanche (AVAX), trying to recover from the area where its decline accelerated in mid-2022, could not surpass the $50 resistance and lost the middle line. This means the support at $31.5 in the parallel channel could be tested. $35 is another key area, and closing below it would significantly damage the hopes for a recovery.
There are two scenarios here. Either the price will bounce from the base support and target the $43 and $50 resistances again. Or we will see a drop to the $22.6 area where the rapid rise began. The cumulative value of cryptocurrencies has the potential to retract to $1.4 trillion, and in a possible decline scenario, this could be the case for AVAX.
The general unease among altcoins is supported by the narrative that it’s time for an interim correction for BTC. The last peak of $49,000 was a notable success in the ETF story for BTC. Perhaps the correction expected before the halving, in the range of $35,000-$37,000, could happen these days?
