From the 2022 low, Solana has been tracing a very large and clean 5-wave uptrend. Note the back and forth through 2023, which was followed by a vertical push higher on max volume and momentum. This is standard 3rd wave behavior, which is the most powerful part of a 5-wave uptrend. The question we now have is: has the final 5th wave swing completed, which would complete the larger uptrend, or do we still have a final swing to new highs in our future?
This question can best be outlined with the following scenarios:
Blue – The 4th wave completed in April. This puts us in the early stages of the 5th wave setup to new highs. Within this larger 5th wave, we have the first wave in place and are currently in the 2nd wave. If any further weakness holds over $111 – $105, we should continue higher toward the $400 – $500 region to complete wave 5.
Red – The 5th wave completed in January of 2025. This means that we might see one more swing higher, but it will not make a new high. This will be followed by a direct drop toward the $74 – $48 region.
If we zoom into the current bounce off the April low, we can see that the push higher has taken the shape of a 5-wave pattern. This supports the bullish blue count listed above. We are now in a 3-wave retrace, which appears to be targeting $117 – $105 region. For the blue count to hold, we must hold $105. Any sustained break below this level will suggest that the bullish setup is breaking in favor of the red count.
In conclusion, our game plan will be to buy on the current drop around our target zone. We will hold this position with a stop and look to close it we move toward the overhead targets listed in the blue count.
Please note: The I/O Fund conducts research and draws conclusions for the Fund’s positions. We then share that information with our readers. This is not a guarantee of a stock’s performance. Please consult your personal financial advisor before buying any stock in the companies mentioned in this analysis.
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