Solana [SOL]: Before you go short, watch out for these factors

Disclaimer: The knowledge introduced doesn’t represent monetary, funding, buying and selling, or different sorts of recommendation and is solely the opinion of the author.

Bitcoin [BTC] confronted intense promoting stress and fell to the $20.8k mark because it skilled a 26% drop in below two days. Ethereum [ETH] fared worse and recorded losses of round 30% in the identical time interval. Solana [SOL] was additionally within the grip of the bears, and its construction on the value charts advised that one other drop may very well be across the nook. If the bulls can reclaim $32, some respite may very well be seen, however the extra probably consequence stays additional losses for Solana.

SOL- 4H

Supply: SOL/USDT on TradingView

The H4 market construction confirmed a powerful bearish bias. Since April, the pattern has been sharply downward, though SOL was in a position to maintain on to the $41 help degree all through Could. In June, nevertheless, the value slipped beneath this degree and has since retested the $45 space as a provide zone, and confirmed $41 as resistance, earlier than falling swiftly prior to now week.

The $32 space (crimson field) has additionally been retested as a provide zone, whereas the $26-$27 space has been retested as a requirement zone (cyan field). The Fibonacci extension ranges confirmed that $27.8 might act as short-term help on the best way south.

SOL- 1H

Supply: SOL/USDT on TradingView

The hourly chart was barely extra sophisticated. The pattern was nonetheless bearish, however the decrease timeframe market construction was damaged due to the push to $32.3 prior to now few hours of buying and selling. In dotted white are two ranges that might see SOL set up a variety inside, with the $29.5 space being a short lived demand zone.

Nevertheless, regardless of this short-term bullish break, the bigger timeframe construction remained bearish. Subsequently, it was probably that SOL would head again towards the $26 mark, and presumably even decrease.

Supply: SOL/USDT on TradingView

The Relative Energy Index (RSI) stood at 49.7, but when the bulls can defend the $29 zone, SOL would possibly nonetheless be capable to push towards $32 as soon as once more. Nevertheless, a session shut under the cyan field would probably see SOL drop towards $26.

The Stochastic RSI fashioned a bearish crossover in overbought territory and was headed decrease, whereas the OBV confronted resistance at a degree that was supported just some days in the past. The promoting stress might drive the OBV to drop but once more.

Conclusion

An hourly buying and selling session shut beneath $29 might provide a chance to enter a scalp quick place, with a stop-loss simply above $30 and take-profit at $26.2. Nevertheless, if the bulls can defend the $29 space, a revisit to the $32 space might provide shorting alternatives.