If Solana's price chart follows the "megaphone" pattern its price could fall by 35%

As it approaches to painting a so-called “megaphone” design, Solana (SOL) is at risk of imploding by 35% in the next days.

The “megaphone” pattern in the SOL price –

In a nutshell, megaphone patterns include at least one lower low and two higher highs over a period of high market volatility. However, these patterns usually include five consecutive swings, with the last one typically indicating a breakout.

Since the beginning of 2022, COTI has been drawing a comparable pattern, with the coin undergoing a pullback after testing the megaphone’s upper trendline near $140 as resistance — the fourth wing.

As a consequence of the pattern, the Solana token may continue to fall below the megaphone’s lower trendline as support at $65, about 35% less than current levels.

Is it possible for SOL to plunge even further? –

If this happens, after forming the fifth swing on its prevailing megaphone structure, SOL may sink even more. While determining a suitable downside target in the event of a breakout is difficult, traders usually select it by measuring the distance between the two trendlines from the point where the lower one breaks.

SOL/USD weekly price chart featuring ‘megaphone’ breakout scenario. Source: TradingView

It’s possible that a bearish breakout might send SOL’s price on its way towards nearly $40 in the next few weeks.

On the other hand, because of its bearish megaphone pattern, SOL’s price may not be able to break out beyond a series of hard support levels.

SOL’s 50-week exponential moving average (50-week EMA; red wave) and an upward sloping trendline (black line) have served as accumulation zones for traders, as seen in the chart below.

As a result, if an early pullback from the 50-week EMA invalidates the megaphone scenario,

SOL/USD weekly price chart featuring 50-week EMA and rising trendline support. Source: TradingView

Consider a scenario in which the price falls below the 50-week EMA, then rebounds from the trendline support. In that case, it might confirm a “rising wedge” or “bear flag” pattern, linked to the megaphone pattern’s top line – another bearish situation.

SOL/USD weekly price chart featuring bear flag/rising wedge scenario. Source: TradingView

After calculating the maximum distance between the upper and lower trendlines at around $40 and subtracting it from the target beneath $100, the falling wedge’s downside target appears to be close to $60.

Meanwhile, since the bear flag’s objective is near $30, we’ll start there. After accounting for the height of the previous uptrend at about $60 and subtracting it from the potential breakout point near $90.

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