- SOL/USD shows bullish momentum but faces resistance at $20.98.
- Traders should exercise caution and monitor key support levels and indicators.
- The Keltner Channel and Vortex Indicator suggest a potential for a short-term correction.
Early in the day, Solana’s (SOL) market was under the bear rule, with its price retracing to an intraday low of $20.17, where support levels were challenged. After establishing support at this level, the bulls rushed in and managed to fly the price to an intraday high of $20.98, where they met tough resistance.
As of press time, the bullish attitude was still strong, with a 2.46% gain to $20.87 from the previous day’s closing price, showing that the bulls remain in charge of the market. But, traders should exercise caution since the resistance level of $20.98 may prove difficult for SOL to surpass in the immediate run.
SOL/USD 24-hour price chart (source: CoinMarketCap)
If the bullish trend continues and the resistance level is broken, the next possible resistance levels to keep an eye on are $21.50 and $22.00. On the other hand, if the bears get control, SOL might revisit the support levels that are located at $19.50 and $18.80.
SOL/USD 2-Hour Technical Analysis
The Keltner Channel bands on the SOL/USD price chart suggest a narrow trading range for SOL/USD in the near term, with the top bar at $21.20 and the bottom bar at $20.06. This move urges traders to wait for a breakthrough above or below the upper or lower bands before placing any big positions.
The formation of green candlesticks due to the price action moving closer to the upper band is suggestive of the accumulation of bullish momentum, which may eventually result in a possible breakthrough above the upper band.
Nonetheless, the TRIX indicator’s descent into the negative territory with a reading of -1.07 implies that a bearish reversal is still conceivable. This pattern indicates that the bullish force is insufficient to propel the price over the upper band, and traders should wait for further confirmation before taking any long positions.
Nevertheless, a bullish crossing has been witnessed as the Vortex Indicator crosses above its signal line with a reading of 1.0938. This indicates that buyers are likely to gain control of the situation. Despite the fact that the TRIX signal shows a likely bearish reversal, traders should continue to exercise caution since this trend implies that there may be some upward momentum brewing.
SOL/USD 2-hour price chart (source: TradingView)
SOL/USD 24-Hour Technical Analysis
The Keltner bands are moving linearly on the 24-hour price chart, indicating that the current bullishness will likely continue in the short term. Nevertheless, the price movement trending below the middle band shows that a pullback or correction is possible in the near future, so traders should keep a watch on key support levels and indicators to decide when to initiate or exit positions.
The TRIX movement in the negative area, with a reading of -13.04, adds to the probability of a short-term correction, signalling that traders should be cautious and wait for a bullish crossing before starting long positions. Monitoring trade volume and market mood may also give useful information into the direction of SOL’s price movement.
With a value of 1.0266, the Vortex Indicator has also gone below its signal line, indicating that the force of the bulls in SOLs price movement is waning, which might lead to a probable negative trend in the near future. To prevent substantial losses, traders may wish to consider using risk management measures and changing their holdings appropriately.
SOL/USD 24-hour price chart (source: TradingView)
In conclusion, SOL/USD shows signs of bullish momentum but caution is advised as resistance levels may pose a challenge.