Solana (SOL) Price Holds Steady — Indicators Flash Bullish Signs Amid $100 Risk
Key Takeaways
- Solana’s price has formed a falling wedge, which could invalidate the bearish pattern shown earlier.
- The MACD shows a bullish crossover that might restrict SOL from another double-digit correction.
- SOL price is likely to bounce toward $160.60 amid the positive reading of the Chaikin Money Flow.
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For most of 2023 and 2024, Solana (SOL) led the crypto market back into the bull cycle. But now, it has taken the back seat.
As of this writing, Solana’s price which rallied from $8 to nearly $300 in less than three years, is back below the $130 mark. This correction has spread speculation that the token is about to return to the bear market.
While these concerns are valid, indicators reveal that SOL is showing strength, indicating that another downturn might not occur as quickly as anticipated.
Solana Aims for Turnaround
After reaching a new all-time high on Jan. 19, Solana’s price briefly fell below $120 on March 11. This development caused panic with some analysts predicting that the altcoin’s value might continue to trade lower.
However, SOL recovered and retested $137 before its recent decline to $128. According to the daily chart, the decline drove Solana’s price to hit lower highs and lower lows.
Hitting these low values then led to the formation of a falling wedge. A falling wedge is a bullish reversal chart pattern formed by two descending trendlines.
The upper trendline represents lower highs and the other marks lower lows. This pattern typically indicates a potential breakout to the upside once the price breaches resistance.
As seen below, SOL price is flirting with the resistance near $135.35 with support at $117.21. Amid this setup, the Moving Average Convergence Divergence (MACD) has returned to the positive region.
This MACD reading indicates rising bullish momentum. If sustained, and the 12 EMA (blue) maintains its crossover above the 26 EMA (orange), then SOL might break above the upper trendline.
Once broken, the cryptocurrency’s value next target could be around $178.89, invalidating the bearish bias it previously showed.
SOL Price Analysis: Likely to Breach Resistance
Further assessment of the daily chart shows validation from the Chaikin Money Flow (CMF). The CMF measures the flow of liquidity in and out of a cryptocurrency.
When the CMF is positive, it indicates rising accumulation, which could positively impact the price. A decline, on the other hand, indicates distribution, which is bearish.
As the chart below illustrates, Solana’s price slight rebound happened alongside a jump in the indicator’s rating. At press time, the indicator’s reading is 0.02, indicating that SOL is experiencing buying pressure.
If sustained, SOL’s price might reclaim $160.60 at the 0.618 Fibonacci level. Once that happens, the next target for the altcoin could be a run $186.15 at the 0.50 Fib level.
Should buying pressure intensify, then Solana’s price might surpass $200 again. However, if the token fails to retest $160.60, this forecast might not come to pass.
Instead, SOL might experience a decline to $109.35. If demand fails to pick up at this point, the price might crash toward $77.91.
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