Solana [SOL] rebounds from the $60 mark, should investors go long now
Disclaimer: The findings of the next evaluation are the only opinions of the author and shouldn’t be thought of funding recommendation
Bitcoin reached lows that it had final traded at in July 2021, and Solana reached an space of demand from final August. Does that imply a aid rally is across the nook? In a means, that aid was already seen on the charts. Solana dropped as little as $60.13 earlier than bouncing to $70.17, a transfer that measures round 21% from the swing low. It appeared that the bears may very well be again within the driving seat as soon as extra.
SOL- 2 Hour Chart
The cyan field extends from $66 to $71 and has been an space of demand previously. In August 2021, the worth flipped this area from resistance to assist and rallied to succeed in $216 and $260 in September and November respectively.
Since late November, the worth has been on a downtrend on the upper timeframes. The development has been bearish on the shorter timeframes as effectively after the $94.9 degree of assist gave means in late April.
Will SOL reverse its development at this excessive timeframe demand zone? It’s unlikely, regardless of the robust bounce. On the decrease timeframes, the $74-$76 space may provide resistance, in addition to the $80.5 degree.
On the two-hour chart, the RSI has been beneath the impartial 50 line for the higher a part of the previous week. On the identical time, the worth has made a collection of decrease highs and decrease lows. Furthermore, the 21-period shifting common (orange) has been beneath the 55 SMA as effectively. All of those had been indicative of a persistent downtrend previously two weeks.
The RSI additionally registered a hidden bearish divergence, the place the RSI made greater highs however the value shaped decrease highs. This growth on the hourly chart additionally instructed that the downtrend may resume the next day.
The Chaikin Cash Move was beneath the -0.05 mark as effectively, to indicate important capital move out of the market. This was to be anticipated, after the robust downtrend of the previous few days and the heavy promoting strain the day before today. Correspondingly, the A/D line was additionally plumbing new depths.
The symptoms unanimously confirmed robust bearish momentum and heavy promoting strain, and the worth motion was additionally of a bearish nature. The bounce from the $65 space may push as excessive as $75. To the north, the $75 and $80 areas are more likely to pose resistance to the bulls’ makes an attempt at restoration.