Solana is still headed for over $300 says an analyst at CCN after breaking down the SOL’s current levels and price action trends.
In October, the price of SOL surged over 10%, breaking through a long-term descending resistance trend line, which indicated the end of a nearly six-month correction.
However, SOL has since struggled to maintain this upward momentum and is now back below the resistance line.
It currently trades within a crucial horizontal support level that could influence the direction of the short-term trend.
Examining the price action, SOL has been moving within a symmetrical triangle pattern since reaching its yearly high of $210 in March.
Last week, it briefly rose above the triangle’s resistance line but could not hold that position, forming a bearish engulfing candlestick.
This pattern often precedes downward movements, which could see SOL drop to the triangle’s support line at $140.
Despite the recent inability to maintain the breakout, some technical indicators remain optimistic.
The Relative Strength Index (RSI) is above 50, and the Moving Average Convergence/Divergence (MACD) is positive and rising, suggesting that a breakout may still be on the horizon.
However, the daily chart presents a more ambiguous picture.
After the earlier deviation, SOL returned to the $160 horizontal support area, which had previously acted as resistance, indicating a potential retest.
Yet, bearish signals are emerging.
The MACD has crossed into bearish territory, and the RSI is at risk of dropping below 50.
If this occurs, SOL could decline to the ascending support trend line at $150, which would be a more bearish scenario, indicating that the breakout above $160 was merely a false signal.
Currently, the wave count suggests that SOL is in wave four of a five-wave upward movement, structured as a triangle.
Whether wave four has concluded or if another low is forthcoming remains uncertain.
If wave four follows an A-B-C structure, it would imply that the correction ended in August, and SOL is now in the final wave of its increase.
Conversely, if it follows an A-B-C-D-E structure, another decline might occur before a breakout.
Both scenarios are plausible given the mixed signals from the daily chart.
Nevertheless, the long-term outlook appears bullish.
The target for the peak of this upward movement is estimated between $273 and $306, based on the 1.61 external Fibonacci retracement of wave four and matching the length of wave five to the combined lengths of waves one and three.
Overall, the short-term trend for SOL remains uncertain following last week’s failed breakout.
A strong bounce at the $160 level could indicate a market low, while a close below this level may lead to a deeper decline.
Regardless, the long-term trend continues to look positive, with a breakout from the triangle potentially driving prices toward the $273 – $306 range.
But I’m curious to know what you think about Solana (SOL) at the moment — leave your thoughts below.
Also Read: Solana Is Now About To Get Flooded With Massive Liquidity
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