Solana risks slide to $74 as probability of Fed rate hike hits 99%

Core takeaways

• SOL has fallen 9% in the last week as US political uncertainty and rising views of stricter monetary policy pressure crypto markets.
• According to CME FedWatch data in the report, the chance of a December Fed rate increase leaped from 84% to 99%.
• SOL could drop to $74 or below if support at $80 collapses, though an oversold RSI around 25 indicates a short-term recovery is still possible.

SOL continues to face heavy selling pressure, having dropped roughly 9% in the last seven days. Weakening market sentiment and a decline in network activity have increased fears of additional declines.

SOL is nearing the key $80 support level as market participants react to growing expectations of a December rate increase by the Federal Reserve.

The probability of a rate hike rose to 99%, per CME FedWatch data cited in the report, after Fed Governor Christopher Waller's recent remarks bolstered expectations of tighter policy.

Probability of Fed rate hike climbs to 99% after Waller's speech

Tighter US monetary policy expectations have risen sharply after Federal Reserve Governor Christopher Waller made hawkish comments.

Waller, speaking at a Bank of England conference, said he backed another rate hike at the December Federal Open Market Committee meeting.

He stated that even if inflation improved from September levels, he would still want the federal funds rate raised by 25 basis points.

Waller also hinted that stronger action might be needed if inflation overshot his forecasts considerably.

The remarks caused a swift shift in market expectations. Per the report, CME Group's FedWatch Tool data showed the December rate hike probability jumped from 84% the day prior to roughly 99%.

The shift implies that traders are more and more convinced the Fed will keep restrictive policy.

Higher rates can make the investment climate harder for cryptocurrencies.

SOL price prediction: Potential fall to $74 if $80 support fails

The technical picture for Solana stays negative as SOL nears a critical support area at $80.

SOL is approaching a fair value gap (FVG) that was created during the August rally. This FVG could act as a key demand zone where buyers try to defend the asset.

But a clear break below the support level would further damage the technical structure.

If SOL cannot hold around $80, the next major downside target is close to $74. Prolonged trading below that point could lead to further declines, though the analysis provided does not specify a verified lower support level.

Momentum gauges point to increased selling pressure. The daily RSI has fallen to around 23, putting SOL well into oversold territory.

An RSI reading below 30 usually means the selling pressure has become extended, which can raise the chance of a short-term bounce.

Even with the dominant bearish trend, the oversold signals in Solana indicate that buyers might try a recovery close to the current support area.

The $80 level is especially significant as it aligns with a fair value gap that could draw in buyers.

Holding this zone could trigger a short-term upturn, possibly pushing SOL back up toward its next major resistance near $95.

On the other hand, losing the $80 level would raise the probability of a drop to $74.