Solana (SOL): Worst Drop in 3 Years, US Dollar to Decimate Bitcoin (BTC)? Shiba Inu (SHIB) Surprise Recovery Possible

Solana has just seen its biggest price drop in three years, falling 45% from its most recent high. Due to intense selling pressure, the asset — which was among the best performers during the previous bull cycle — is currently causing investors to worry about its short-term future. A strong bearish trend is indicated by SOL's decline below the pivotal 200-day moving average, which is clearly broken by key support levels on the most recent price chart.

This action implies that buying interest has been greatly outweighed by selling pressure, which has probably been made worse by general market worries and the recent drop in investor risk appetite. The price is now testing levels around $170 after falling below $190, a crucial support zone in the past. According to the Relative Strength Index (RSI), the asset has moved into oversold territory, which may portend a relief bounce.

With the 200-day moving average breached and important psychological levels like $200 not held, there is now more selling pressure. The $160-$170 support range is an important area to keep an eye on. It is possible to anticipate additional drops to $150 or less if Solana is unable to maintain this zone. Alternatively, bullish momentum would need to reclaim the 200-day moving average and recover above $190.

Bitcoin under pressure

A pivotal moment is ahead for Bitcoin as the U.S. Dollar Index (DXY) is showing indications of strength, which could jeopardize the upside potential of Bitcoin. Historically, there has been an inverse relationship between Bitcoin and the dollar index when the dollar appreciates Bitcoin and other risky assets typically decline. Since DXY is still trading above 106, it is unclear where Bitcoin will go in the future.

Bitcoin is currently struggling to break out of its consolidation range, trading at about $95,700. With resistance close to $100,000 and support forming at $93,500, the asset has been moving sideways. If Bitcoin is unable to maintain this level of support, a drop toward $90,000 may be imminent.

In relation to a basket of foreign currencies, the dollar has recently recovered from its moving averages. This points to a potential shift in liquidity away from Bitcoin and other digital assets due to the dollar's renewed strength. Bitcoin may find it difficult to maintain any bullish recovery if the DXY keeps up its upward trajectory. Bitcoin may move toward the 200-day moving average, which is close to $85,000, if it breaks below $93,500, which could lead to a more severe correction.

Bullish case: A break above $100,000 could rekindle bullish sentiment if Bitcoin is able to maintain its current range and the dollar declines. However, traders continue to exercise caution due to the persistence of macroeconomic uncertainty. The next course of action for Bitcoin will mostly depend on how the U.S. dollar does over the next few weeks.

If the dollar's strength continues, there may be more pressure on Bitcoin sellers. But if macroeconomic conditions change to favor riskier assets, Bitcoin may gain the momentum it needs to overcome significant resistance levels.

Shiba Inu finds hope

Speculation regarding a possible recovery has been sparked by Shiba Inu's current hovering around its recent lows. SHIB may still be able to reverse its downward trend even though the market is not showing much upward momentum if it forms a double-bottom pattern around $0.00001485.

Despite consistent selling pressure, the asset has been unable to overcome significant resistance levels such as the 26 EMA. In the event that SHIB is able to maintain its current support zone and draw in fresh buying interest, a technical rebound could occur. Even though double-bottom formations have historically been a powerful reversal signal, the current market's uncertainty and low trading volume make such a move unlikely in the near future.

In order to confirm a recovery attempt and possibly move it toward the next resistance level at $0.000020, SHIB must regain strength above $0.00001713 in order for a bullish scenario to materialize. Even though the current state of the market indicates that there is little chance of a quick breakout, a rally to $0.000022 could occur if buying pressure increases.

On the downside, more drops might occur if the $0.00001485 support is not maintained. The double-bottom setup would be void if there were a break below this level, which might push SHIB down to $0.00001300 or even lower.