Solana's bullish trend has come to naught: does SOL have a chance of a rebound
Date: 2023-08-06 Author: Karina Ziganova Categories: IN WORLD
The price of Solana (SOL) has been falling since July 14, when it hit a yearly high of $32.13. The decline confirmed the $27 horizontal area as resistance.
Contradictory indications of the weekly and daily timeframe make it difficult to determine the direction of further movement. Currently, the long-term trend is bullish and the short-term trend is bearish.
Solana trades below long-term resistance
The technical analysis of the weekly timeframe shows that the price of Solana has broken above the descending resistance line that has existed for over 600 days. Such movements often signal the end of a previous trend and the beginning of a reversal.
However, after that, the asset met strong resistance at $27, which led to the formation of a long upper wick, indicating an increase in selling pressure. As a result, the price of SOL began to decline - at the moment, the token is trading below the $27 horizontal area.
The readings of the weekly Relative Strength Index (RSI) confirm the legitimacy of the breakout. At the moment, it is above the 50 mark, closing the week at these values for the first time since the end of 2021.
However, in order to confirm the reversal, the bulls need to gather their strength and push the SOL above the $27 horizontal area.
SOL Price Forecast: Deviation could be a sign of further decline
While the weekly timeframe is leaning towards the bullish scenario, the daily timeframe is giving bearish signals.
The main reason for the development of a negative scenario is Solana's deviation from the $27 resistance area (it is marked with a red circle on the chart), followed by a decline to a local low of $22.48.
The daily RSI is bearish as well, falling for two weeks before finally dropping below the 50 mark.
If SOL continues to fall, the next major support will be at $17. However, a rebound to $27 will mean that the bulls are once again gathering strength and ready to defend the growth.
