SOL/USD Price Analysis – June 06, 2023

Daily Price Outlook

The Solana (SOL) coin has been unable to break its declining streak and remains on a downward trajectory, hovering around the $20 level. However, it has shown impressive performance recently, with a notable increase of 14.61% in the past few weeks.

Unfortunately, these gains were short-lived as the cryptocurrency market turned bearish. It is worth noting that the Securities and Exchange Commission (SEC) recently filed a lawsuit against Binance, alleging illegal operations in the US.

This lawsuit specifically mentioned popular coins like SOL, ADA, and MATIC as unregistered securities, causing their prices to drop significantly. The current Solana price is $20.06, with a 24-hour trading volume of $560,175,893. Solana is down 6.98% in the previous 24 hours.

SEC Files Lawsuit Against Binance, Alleging Unregistered Securities Trading and Sales

The US Securities and Exchange Commission (SEC) recently filed a lawsuit against Binance, claiming it offered trading and sales of cryptocurrencies without proper registration.

The lawsuit mentioned popular cryptocurrencies like Cardano (ADA), Polygon (MATIC), and Solana (SOL), stating that they were considered unregistered securities.

The SEC also alleged that Binance had previously listed assets that faced enforcement action by the commission. Consequently, the value of these tokens, including Solana, Algorand, Polygon, and Polkadot, experienced considerable drops.

Meanwhile, Binance, led by CEO Changpeng Zhao, is accused of violating US securities laws. The SEC argues that Binance operated as an unregistered exchange in the US, enabling high-value US customers to bypass restrictions. Binance, however, denies these allegations and is defending itself against the lawsuit.

Hence, this news has had a significant impact on Solana’s (SOL) coin price. Following the announcement, the value of SOL experienced a notable drop. The market sentiment surrounding SOL became bearish as investors reacted to the potential regulatory implications and uncertainty surrounding the coin’s classification.

Solana Price Chart – Source: Tradingview

SOL/USD – Technical Outlook

Solana has successfully recovered from the support zone at $19.20 and has now surpassed the significant psychological level of $20. The presence of a bullish engulfing candle followed by another bullish candle indicates a growing sense of optimism among investors, which will greatly influence future price movements based on both technical and fundamental factors.

Presently, investors are facing uncertainty regarding the market’s direction, particularly due to the SEC’s lawsuit against Binance. This has resulted in a risk-on sentiment affecting both the precious metals market and cryptocurrency prices.

Should Solana manage to maintain its position above $20, it holds the potential to reach the next target at $20.39, aligning with the 38.2% Fibonacci retracement level.

A successful breach of this level could lead to further gains, with a subsequent target at $20.76, corresponding to the 50% Fibonacci retracement level. Beyond that, the subsequent target lies around $21.2, representing the 61.8% Fibonacci retracement level.

Conversely, if Solana experiences a decline below the support level of $19.75, the next level of support is expected to be around $19.20.

Therefore, closely monitoring the price action around $19.75 is crucial, as a sustained move above this level would indicate a strong continuation of the upward trend.